Teaching Comparative Government and Politics

Friday, April 12, 2013

Another review of change in Mexico

I've read two or three articles like this one about the programs of Mexico's new president. They've all expressed reserved optimism and a "wait and see" attitude. They all also agree that things look different than they used to.

Working through a reform agenda

[T]he past few months have seen Mexico’s legislators jolted awake. Enrique Peña Nieto, who became president on December 1st, has set a furious pace, pushing through reforms designed to correct some of his country’s long-standing structural weaknesses…

Enrique Peña Nieto

Before last July’s presidential election [his] party did its best to block the proposals of Felipe Calderón (who in any case proved to be inept at constructing consensus). After Mr Peña’s victory this changed, with the passage of a labour reform that the PRI had previously blocked. An education law in February claws back control of teachers’ hiring and firing, previously the preserve of the teachers’ union. The new president sent a powerful signal to dissenters when the union’s leader, Elba Esther Gordillo, once a leader of the PRI, was arrested on charges of embezzling more than $150m of union funds (an allegation she denies).

Next came a shake-up of telecoms and television, passed by the lower house in March and expected to be passed by the Senate soon…

The proposal amounts to “a very good reform on paper”, says Agustín Díaz-Pinés, a telecoms expert at the OECD, a Paris-based rich-country think-tank… But Mr Díaz-Pinés warns that effective implementation will be vital. Regulators have hitherto been bossed around by the firms they were meant to keep in line…

Behind these reforms lies a “Pact for Mexico” struck between the PRI and the two main opposition parties in December. The Pact unites Mexico’s political parties against the unelected interests that have long defied them…

A bigger test of the Pact will come after the elections, when Mr Peña is due to publish his next proposal, a combined fiscal and energy reform designed to realise the enormous potential of Mexico’s oil and gas reserves. The country does not make the most of these: half its oil is in deep waters, of which Pemex, the state-owned oil and gas monopoly, has little experience. The state’s milking of Pemex’s profits has left it unable to invest in the necessary technology. To wean itself off oil revenue the government will have to raise taxes, probably applying value-added tax to food and medicine. The PRI changed its party constitution last month to allow this. But polls show overwhelming opposition to taxing those essentials…

Another test is security. Mr Peña has helped to shift attention to Mexico’s perky economy rather than its gruesome violence… The murder rate is about a quarter lower than at its peak in the summer of 2011; in February it registered a three-year low. But killings remain nearly twice as common as six years ago; extortion and kidnapping are an everyday menace…

But if he comes up with a clearer plan to reduce violence, and achieves an energy reform worthy of the name, Mr Peña will have had an impressive first year.