Teaching Comparative Government and Politics

Thursday, August 11, 2016

Rich and powerful target for politicians

While super rich people often wield lots of power, many of them do so in civil society or behind the scenes in politics. One of Mexico's super rich and super powerful men has become a target of the PRI and the Mexican government. Does that make him a political actor as well as an economic one? The New York Times writers emphasize economic power, but the political power is implied.

Mexico’s Richest Man Confronts a New Foe: The State That Helped Make Him Rich

All is not well in the kingdom of Carlos Slim.

Carlos Slim

For more than 25 years, he has dictated the terms of Mexico’s telecommunications industry and built an empire, making him one of the world’s richest men.

Mr. Slim and his family are billionaires 50 times over…

But at home in Mexico, the game is changing…

Determined to bring his dominance to an end, leaders from Mexico’s three biggest political parties have put aside their own animosities in recent years, meeting in secret sessions to chip away at Mr. Slim’s domain.

Now, the plan they concocted to increase competition in the telecommunications industry, signed into law two years ago, is starting to bite…

“What has changed the most and is most relevant here is the authorities, and their attitude toward this empire,” said Ernesto Piedras, the director general of the Competitive Intelligence Unit, a consulting and research firm…

His monopoly was so dominant that it cost Mexicans an extra $13 billion a year between 2005 and 2009, according to the Organization for Economic Cooperation and Development. Still, his wealth, armies of lawyers and government connections kept him a step ahead of weak regulators, former officials say…

But when the Institutional Revolutionary Party [PRI] took back the presidency in 2012, it looked to reassert its power in a country where the state — not big businesses — has traditionally been king. And Mr. Slim offered a way to score political points at the same time: Mexicans were already openly scornful of what they called his expensive and often unreliable service…

For Mexico, the telecom law offers a stark contrast to the state’s many failed promises — to end corruption, enact the rule of law and bridge inequality. That the government has managed to take on Mr. Slim, arguably the country’s most powerful citizen, is proof that where there is political will in Mexico, there is a way.

“This administration invested in the economic reforms, but they ignored the reforms in the judicial system and in the field of corruption,” said Enrique Krauze, a prominent Mexican historian who knows Mr. Slim…

There are many stories of Carlos Slim’s rise: the son of Lebanese immigrants who inherited a family retail business and built an empire, piece by piece, down the long Latin American stretch of the Western Hemisphere. Those vast holdings include a significant number of shares in The New York Times.

But there is another side, officials say — of tying up regulation in countless legal knots, of befriending the rich and powerful who identified his success with their own…

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