Mexico's next government


A few days ago, I sat down with Arturo Sarukhan, coordinator of international affairs for Felipe Calderón, the PAN candidate for president of Mexico in the July 2 election.

As has been widely reported, Calderón won by a 36-to-35 percent margin over the leftist PRD candidate Andrés Manuel López Obrador; that victory has been certified by IFE, Mexico's independent election agency, and the final verdict is to come before September 6 from TRIFE, the panel of judges that makes the final decision. TRIFE rejected AMLO's call for a full recount, which is not authorized under Mexican law, and appears certain to certify Calderón as the winner. AMLO has gotten thousands of his supporters to camp out in the Paseo de la Reforma and block the streets from the Zocalo, the historic center of Mexico City, to the Bosque de Chapultepec. The result has been traffic jams horrific even by Mexico City standards.

In any case, it seems clear that Calderón will become president of Mexico and take office December 1. What kind of president will he be? Will he be able to overcome obstacles that have blocked some of the policy reforms sought by the PAN incumbent, Vicente Fox, during his six-year term? What is ahead for Mexico? Here are some of Sarukhan's answers. We will see how things work out.

Calderón stands to enter office more popular than he was on Election Day. Tracking polls show that he would win today by a 15 percentage-point margin and that when respondents are asked to recall which candidate they voted for, Calderón leads by the same margin. That's the kind of result you get to the recalled-vote question after a president has assumed office and has a high job rating.

The blocking of the Paseo de la Reforma by AMLO supporters has reduced his popularity in Mexico City, where he served as mayor from 2000 to 2005 and which was his strongest area in the election. And AMLO's legal team has been unable to prove vote fraud; specific charges have been refuted by PRD members who were present at the cited polling places.

One key challenge for a President Calderón is the need to deregulate the monopolies that have resulted from Mexico's privatizations over the past 15 years. Television, telecommunications, and cement companies have been dominated by individuals like Carlos Slim, one of the richest men in the world. Mexico would be better off if these firms had competition. New antitrust laws could provide more competition and weaken monopolies.

Immigration to the United States remains a vital resource of the Mexican economy: Immigrants send back $19 billion in remittances. Labor mobility was not a part of the NAFTA treaty; it needs to be addressed now. Stricter border enforcement, starting in the 1990s and ratcheting up during the Bush years, has meant that many illegal immigrants remain in the United States, even when unemployed, and bring in their families; they don't want to take their chances crossing the border back and forth. A temporary guest worker program is necessary, as well as enhanced border security.

Immigration continues to be highest from certain Mexican states, mostly in the center of the country: Michoacán, Zacatecas, Jalisco, Aguascalientes, Puebla, Guerrero, Oaxaca, and Hidalgo. So many Pueblans have gone to New York that they call it Pueblayork. But starting about four years ago, there has been high unemployment in and high immigration from the Distrito Federal (the center of the Mexico City metropolitan area). That's why Calderón emphasized job creation as his key issue in the campaign; he said he would be a presidente del empleo.

Calderón ran ads in March and April comparing AMLO with Venezuela's Hugo Chávez. That helped to create an impression, fortified by AMLO's conduct as mayor of Mexico City, that AMLO is authoritarian and intolerant. Those ads helped Calderón jump ahead in the polls, and then he emphasized job creation. Some voters waited until Election Day before deciding, and the bulk of them went to Calderón.

Between 1929 and 1997, Mexico's Congreso was by and large not a decision-making body. The ruling party PRI had majorities in the Senado and Cámara de Diputados, and PRI members usually voted as the PRI president ordered. Decisions were made in Los Pinos, Mexico's White House. But PRI lost its majority in the Cámara in 1997 and in the Senado in 2000; no party has had a majority since. Some of Fox's key legislative priorities were blocked by PRI and PRD members, and PAN lost seats in the 2003 Cámara elections. The results on July 2 were different. PAN is now the largest party in both houses, 11 votes short of a majority in the Senado and 43 votes short in the Cámara. PRI is the third-largest party in both houses, and some PRI members and members of the two small parties may be willing to vote with PAN on key issues.

One of the major problems facing Mexico is running Pemex, which was granted a monopoly of the oil industry in the 1930s; the Constitution forbids foreign oil companies. Pemex is heavily overstaffed, and the Pemex union has been a potent political force and was one of the leading sources of power in PRI for many years. The government depends on Pemex for a large percentage of its revenues, but production in Mexico's largest oil field in the Gulf of Mexico is sharply down and may peter out in a dozen years. As president, Calderón can appoint a board of governors that can produce more transparency of operations. He would need a constitutional change to allow Pemex to make strategic partnerships for deep-sea exploration, but many non-PAN members may be open to this because it appears that Pemex is incapable of doing this on its own. There is also support in non-PAN parties to open up Pemex to private foreign investment in petrochemicals, natural gas, oil distribution, and electricity generation.

What's my response? Vicente Fox's election in 2000 was greeted as a new era in Mexico, one in which it seemed suddenly possible that all of Mexico's problems hadbeen solved. But many of Fox's admirers have been disappointed by the results. Perhaps unduly disappointed: Mexico's economy is growing at a good rate, its currency seems stable (no devaluation since 1994), there has been progress in strengthening the rule of law. Calderón seems prepared to offer further reforms, which may well be passable in the Congreso. Countries don't change overnight. But Mexican voters' decision, by a very narrow margin, to elect Felipe Calderón seems to put Mexico on a trajectory to further progress to freer markets, more economic growth, stronger democratic institutions, and rule of law.