The Mexico Bubble

Is President Enrique Peña Nieto about to fall to Earth?

When U.S. President Barack Obama travels to Mexico this Thursday for his first summit with new President Enrique Peña Nieto, he's going to hear a lot about the country's uptick in international portfolio investment, its recent discovery of vast new petroleum reserves, and its new political grand bargain, called the "Pact for Mexico," in which the leaders of the three largest political parties have gone behind closed doors to hammer out deals on tax, education, energy, banking and telecom reform, among other areas.

But instead of giving priority to the interests of Wall Street and of Mexico's discredited political class, Obama should turn his gaze to Main Street and listen to the voices of the Mexican people on both sides of the Rio Grande. Otherwise, he risks committing the United States to a highly risky political game run by Latin American cronies that could soon end in disaster, with an impact that could be felt across North America.

According to the hype, Peña Nieto has already transformed the political landscape in Mexico after only four months in office. Time magazine has named him one of its "100 Most Influential People in the World," claiming that he "combines Reagan's charisma with Obama's intellect and Clinton's political skills." The Financial Times raves that with the death of Venezuela's Hugo Chávez, Peña Nieto may now take up the torch of Latin American leadership and revive the "Washington Consensus" that predominated in the region during the 1980s and called for drastic restrictions in social spending and the implementation of "trickle-down" neoliberal economic policies. The Washington Post editorial board suggests that "Washington should be cheering Mexico's gridlock busting -- and taking it as an example." Meanwhile, Thomas Friedman, of the New York Times, has called Mexico the "Comeback Kid" and Shannon O´Neil argues in Foreign Affairs that Mexico has now "made it."

Such exaggerations have no basis in reality. Even after months of an expensive, high-profile media blitz, Peña Nieto has begun his administration with the lowest public approval rating of any Mexican president over the last two decades. Only 50 percent of Mexicans approve of his presidency today, much less than the 70 percent who supported the first non-PRI president, Vicente Fox, at the beginning of his term, according to Reforma newspaper. Peña Nieto's approval rating is even lower than that for presidents Ernesto Zedillo and Felipe Calderón at the disastrous crisis-ridden beginnings of their terms, according to the same source.

A recent poll also shows increased public skepticism in Peña Nieto's, "Pact for Mexico," Today, only 21 percent of the population believes that this pact will benefit them while 31 percent are convinced that it will harm them. This same independent poll reveals that the majority of the population perceives the agreement to be in the interests principally of the political parties and big business. Only 35 percent think that the country as a whole will benefit.

It is important to remember that Peña Nieto only received 38.2 percent of the vote in the 2012 presidential elections and that the voting base of his party (Party of the Institutional Revolution-PRI) is principally located in the poorest, least educated, and most isolated rural sectors of the population. All of the most "modern" and "middle class" sectors of the population voted overwhelmingly against bringing the PRI and its pretty-boy candidate back to power, according to independent exit polls and demographic surveys. For instance, the only time Peña Nieto dared to hold a campaign event with college students during last year's presidential race, he was aggressively run off the campus amid shouts that he was an "assassin" and a "thief."

Peña Nieto's strategy has been to compensate for this weakness in public support by co-opting the old political opposition and turning his back on his critics in society. But this approach has recently come up against a brick wall.

For instance, in their haste to demonstrate quick legislative results, the politicians forgot to consult with civil society before pushing through a controversial education reform at lightning speed last December. As a result, today thousands of teachers are on strike throughout Mexico's poorest southern states of Chiapas, Oaxaca, Guerrero, and Michoacán in protest against a reform which they correctly claim threatens to drastically reduce job security, introduce excessive standardized testing, entrench inequality between schools in wealthy and poor areas, and privatize public education. In the state of Guerrero, local citizen militias, parents, and youth groups have even joined with the teachers in a broad-based coalition against Peña Nieto's broader neoliberal economic agenda.

Indeed, the Pact for Mexico itself may soon entirely break apart. A new scandal involving the use of Peña Nieto's federal social programs to purchase votes has led the two leading opposition parties, PAN from the right and PRD from the left, to threaten abandoning the pact altogether unless the president takes action against his own top officials. This will be an important test of political will for Peña Nieto to see whether he is able to prioritize accountability over political expediency.

Meanwhile, Peña Nieto has continued with the time-old tradition of using the justice system as an arm of political control. He has jailed a significant political adversary, Elba Esther Gordillo, a leader of the teacher´s union well known for her corrupt and illegal practices.  But he has simultaneously freed Jesús Angeles, an army general who had links to Peña Nieto´s presidential campaign but was jailed on corruption charges by Calderón shortly before the 2012 elections.

Meanwhile, violence continues to wreak havoc over large swathes of the country.  Organized crime-related executions continue at the startling pace of more than 1,000 a month since Peña Nieto took office on Dec. 1. While some border cities like Ciudad Juárez and Tijuana have shown improvement, other coastal cities such as Acapulco and Veracruz are much worse off than they were in the past. And even in places where the homicide rate has gone down, there is widespread suspicion that this is due more to deals being cut with the drug cartels than to actually defeating them, as reflected in the most recent report of the International Crisis Group and reports in the international press.

Peña Nieto talks about changing the approach to the "drug war" by focusing on reducing crime and improving social programs instead of on drug interdiction, but in fact his strategy has been more of the same. The president has not taken any steps to withdraw the more than 40,000 military troops that today patrol Mexico's streets, putting human rights at grave risk, nor has he taken any concrete measures to clean up endemic corruption in law enforcement. Instead, he has conducted a minor bureaucratic shake-up by eliminating the Fox-era federal public security agency and next plans to create a new national police out of military personal, paradoxically just as Fox himself did 10 years ago. Peña Nieto has also suggested that the media no longer pay so much attention to violent crime, as if turning the other way could somehow make the problem miraculously disappear.

The press, meanwhile, has come under heavy attack under the new administration. Three of Mexico's leading female investigative journalists, Lydia Cacho, Anabel Hernández, and Ana Lilia Pérez, whose principal work has been to expose government complicity with organized crime, have had to leave the country in recent months due to threats and judicial pressure on their work. One of the most important international NGOs that defends press freedoms, London-based Article 19, recently received a letter with credible death threats under the door of its office in Mexico City. Meanwhile, the dominant television and radio monopolies continue to allow very little space for genuinely plural debate on public affairs and rarely criticize the president's policies.

In the economic realm, we need to look beyond the short-term increase in international portfolio investment. According to Mexico's Central Bank, international capital flows have skyrocketed in recent months. This is due to a combination of both low interest rates in more developed economies and the international media hype around Peña Nieto's presidency. Japanese investment has played a particularly important role.  But the recent political difficulties reveal important underlying problems with the top-down development model being pursued by Mexico's new president.

There is also growing concern about underlying fundamentals. For instance, past-due consumer debts are now at their highest level since the 2008-2009 economic crisis. If Peña Nieto responds to today's political difficulties with more police repression, as he did on his inauguration day, instead of by changing course and opening himself up to a genuine dialogue with civil society, the economy could easily come tumbling down like a house of cards.

Peña Nieto's honeymoon has not lasted long. Extremely controversial reforms such as a new role for foreign oil companies in the energy sector and an increase in the value-added tax, which the president had promised to implement at the beginning of his administration, look less feasible than ever. Washington's hope that Mexico could serve as an anti-Bolivarian "stabilizing" force in the region may also have to wait for another day.

But this is good news for the Main Streets of North America. Washington's geopolitics and Peña Nieto's proposed energy and tax reforms were never designed in the best interest of the common man and woman anyway. Instead of increasing its highly regressive value-added tax, Mexico, one of the most unequal countries in the world with a Gini coefficient of .51, should consider implementing capital gains and wealth taxes. Instead of handing over its oil reserves to abusive and environmentally dangerous international oil corporations, Mexico may well be able to manage better on its own by increasing the investment, transparency and technology of its homegrown company, PEMEX. Instead of helping the United States dominate Latin America, Mexico could do a great service to peace and stability in the region by defending a healthy multilateralism.

In general, Peña Nieto's weakness creates an opportunity for organized civil-society groups to start rebuilding the broken link between politics and society which is the underlying cause of Mexico's contemporary problems. Mexico is not a "failed state" that needs to be buffered through increased militarization or by recentralizing power in the executive branch, as Peña Nieto and some scholars seem to think. To the contrary, the central problem is not a lack of state power but the consistent abuse of the government's significant authority by politicians of all colors and stripes to favor friends and punish rivals.

Fortunately, independent citizen action has the potential to transform the system before the entire edifice comes crumbling down in a widespread and dangerous political crisis. If Obama, and the citizens of the United States he represents, dare to look beyond Peña Nieto and into the eyes of their Mexican neighbors, colleagues, and family members, they will inevitably find a source of enormous hope for the future.

Daniel Aguilar/Getty Images


France's Forgotten War

Mali is old news in Paris. Now it’s all gay marriage all the time.

Created in the image of Charles de Gaulle, the institutions and ideals of France's Fifth Republic were tailored for greatness. "France cannot be France without grandeur," the late general once famously declared -- and grandeur could only be grand on the world stage. But if the world was de Gaulle's stage, his audience was decidedly French: Greatness abroad, he believed, would unify his notoriously quarrelsome subjects at home.

The Gaullist imperative to think locally but act globally left a deep mark on subsequent French presidents: Whether conservative, liberal or socialist, they have all been Gaullists when it comes to matters abroad. This insistence on the so-called French exception in the realm of foreign affairs, while often a source of irritation to France's allies, has been an ideal to which the country's public, as well as its political and intellectual classes, have long rallied.

The election last year of President François Hollande, however, was supposed to herald something very different. Having campaigned primarily on domestic economic issues -- his Socialist Party's mantra was "C'est l'économie, pauvre con!" ("It's the economy, stupid!") -- Hollande scarcely mentioned foreign affairs. But something funny happened on the way to France's intervention in Mali in January. In launching an offensive to rout jihadists from the north of the former French colony, Hollande was transformed, like his former mentor François Mitterrand, into an accidental Gaullist. Now, three months after the first French troops arrived in Bamako, France has all but forgotten about its African exploits -- the news that a sixth French soldier died this week in Mali scarcely created a ripple in the French media -- though, as the recent bombing of the French Embassy in Tripoli suggests, Africa hasn't forgotten about France.

While the rapidity of the president's decision to intervene in Mali surprised the political and intellectual classes -- Hollande, nicknamed Flamby after a custard-like dessert, was hardly known for his resolve -- they immediately closed ranks behind him. Public opinion followed, as did France's intellectuals. While few were as gung-ho as Bernard Henri-Lévy, who had earlier led the charge for France's intervention in Libya, most agreed with the French daily Le Monde's verdict that Hollande's decision was "le choix de moindre mal," the lesser evil.

Still, there were those who expressed doubts. Most of the dissenters hailed from the extreme left and, in particular, the Green Party and the Parti de Gauche. Gauche leader Jean-Luc Mélenchon, for example, hinted that Hollande was really after uranium deposits in neighboring Niger, while Green Party leader Noel Mamère dismissed the government's reasons for intervention as "propaganda." Even the flamboyant Gaullist Dominique de Villepin, who served as France's prime minister from 2005-2007, warned that Hollande, ignorant of past and present geopolitical realities, was leading France into another Afghanistan.

The timing of Hollande's decision to intervene in Mali has also attracted the attention of some members of France's chattering class. The philosopher Michel Onfray, for example, mocked Hollande's "pursuit of sandal-wearing Malians while France rolls out the red carpet to states that are buying up our bankrupt country piece by piece." Hollande and his prime minister, Jean-Marc Ayrault, had been in freefall in public opinion polls since the fall of 2012. Confronted by a stalling economy and spiraling unemployment -- much of which, to be fair, could be laid at the feet of former President Nicolas Sarkozy -- Hollande appeared increasingly helpless and hapless. One after another, his campaign promises, from the pledge to keep open the Mittal steel plant in the northern city Florange to the vow to soften the monetary and budgetary dictates of Berlin and Brussels, withered into dead letters. Tellingly, just two weeks after the Mali operation was launched, nearly 90 percent of the French told pollsters that France "needed a true leader to reestablish order." (Perhaps no less tellingly, the pollsters did not ask whether they were thinking of order at home or order abroad.)

Three months later, France is still, even frantically, seeking a true leader. Gaullist grandeur, it turns out, is not among Mali's natural resources. In last week's public opinion polls, foreign policy -- by which most everyone understands Mali -- was the one category where at least 50 percent of the respondents gave Hollande a passing grade. This rather anemic support, however, did not bleed into other categories. The bottom line was, in fact, catastrophic: Scarcely one quarter of the French is satisfied with Hollande. Never before has a French president fallen so fast in the eyes of so many in so short a time.

Even France's early rout of Islamist rebels in northern Mali has failed to slow Hollande's descent into the netherworld of public disenchantment. The intervention borders on a Zen koan: If a military operation realizes its aims, but no one is paying attention, is it successful? French military action in Africa has, for the French, all the novelty of a spring rain in Paris. Since 1958 and the creation of the Fifth Republic, Gaullist, liberal, and Socialist presidents alike have sent soldiers and planes to Africa with a regularity and frequency -- four dozen times, according to one recent estimate -- that has largely inured the French public to new interventions.

Then there is the elusive nature of the mission's long-term success. Judged by the narrowest of criteria -- driving back and dispersing the Islamist rebels of the Movement for Oneness and Jihad in West Africa and al Qaeda in the Islamic Maghreb -- the operation is a victory. The 4,000 French soldiers, aided by a war-ready military contingent from Chad, shattered the Islamist push towards Bamako. Driving north towards the Islamist redoubts in the Adrar des Ifoghas, the vast and heat-blasted expanse of rocks and sand bordering on Niger and Algeria, the French and Chadians liberated the cities of Tombouctou, Gao, and Kidal -- events welcomed with deep relief by the local residents.

But the French public knows this success is provisional, built on foundations as shifting as the region's sand dunes. The French did not destroy the Islamist rebels, but instead mostly dispersed them. The jihadists, far from challenging the French, vanished into the region's countless ravines and caves. For this reason, as a recent United Nations report warned, the reduction of French patrols in the region "risks leading to the return of armed Islamist groups."

The lack of a clear military victory continues to unsettle the local population, which knows the African forces scheduled to take over the operation under U.N. auspices have neither the capabilities nor convictions of the French. Last week, the French Minister of Defense Jean Yves Le Drian, on an official visit to Mali, echoed these concerns, urging Chad to maintain its military presence after France's withdrawal. Le Drian warned of a possible "security vacuum" should Chad's president, Idriss Déby, pull out his troops.

No less worrisome is the political vacuum in Mali. France's minister of foreign affairs, Laurent Fabius, has urged Bamako to hold national elections in July as a means of refurbishing the country's democratic legitimacy: "The world is watching you," he said recently. But Mali's political forces are, in turn, watching one another in intense political maneuvering. Most ominously, the Touareg-led secessionist movement based in Kidal, the National Movement for the Liberation of Azawad (MNLA), whose effort last year to wrest independence from Bamako led to the current crisis, refuses to accept the presence of Malian soldiers on "their" soil. As the movement's vice-president recently warned, as long as Bamako refuses to negotiate the future status of Azawad, the MNLA will not participate in the July elections. Fabius, for his part, noted that a "democratic nation cannot have two different armies" -- an observation with which the MNLA, dreaming of secession, of course agrees. 

But Mali is not the only Francophone nation afflicted with intense political and tribal differences. For the last several months, French politics have been convulsed over a bill, just made into law, which gives gay couples the right to marry and adopt. This is a third reason for the relative indifference in France towards events in Mali. The violence flaring along the margins of the anti-gay Manif Pour Tous demonstrations, in which a number of extreme right movements have participated, has conjured images of the populist, plebiscitary and, for some, fascist movements that threatened republican governments from the 1880s through 1950s. It is not a stretch to place the current unrest in the history of the so-called "guerres franco-françaises" -- the civil wars fought over France's identity that have periodically erupted ever since the Revolution of 1789.

Tellingly, France's intellectuals have said relatively little over the last three months about the Mali intervention. In part, this is because their status and credibility, like that of France's politicians, have declined dramatically of late. They no longer can pretend, as they did during the century stretching from the heyday of Emile Zola to that of Jean-Paul Sartre, to speak with authority on issues that call for professional or technical expertise. This was brutally illustrated last week when Onfray, in a forum hosted by Le Monde, lambasted the invasion as a strategic error. In response, two military historians mercilessly dissected Onfray's vague references to Clausewitz and Sun Tzu, as well as his shaky grasp of military strategy, making it clear that the philosopher, wearing his trademark black-rimmed glasses, was otherwise naked.

More importantly -- and this again brings us to the notion of the Franco-French Wars -- most of the country's intellectuals are deeply preoccupied by the convergence of the Socialist government's deepening political impotence and the massive anti-gay demonstrations that show little sign of abating. This is not surprising: the crowds have brandished signs declaring: "We will not stop even if the law is passed," "Listen up, Hollande: France is in the streets," "Hollande is not my president," and "Abortion plus gay marriage equals euthanasia." More than one Manif Pour Tous leader has compared Hollande to Hitler and described the new law as a coup d'état. When the movement's leader, Frijide Barjot, dismissing the president as a "dictator," growls that if "Hollande wants blood, he'll have it," it suggests that if la patrie est en danger, it is not necessarily because of a motley collection of Islamists wandering the rock-strewn immensities of Mali.