Mexico spoke

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MEXICO CITY, MEXICO - MARCH 10, 2022: Mexico City's Mayor, Claudia Sheinbaum during the Mexican´s President Andres Manuel Lopez Obrador daily morning news conference at the National Palace in Mexico City. On March 10, 2022 in Mexico City, Mexico. (Photo credit should read Luis Barron / Eyepix Group/Future Publishing via Getty Images)

Risking the loss of what has been gained is not acceptable, which is why the support for Claudia Sheinbaum was total and unconditional. There’s no turning back; she will govern without counterweights. The majority of Mexicans are not interested in democracy; they prefer populism and handouts, and the message was very clear. AMLO’s gamble had undeniable effects. Although there are still nine million Mexicans in extreme poverty, many have overcome it with the support they receive per family, due to the increase in the minimum wage, and because of a strong peso. And nothing changes the perception that I have more money in my pocket and I am satisfied with a government that uses public resources to distribute scholarships, aid, and support.

It doesn’t matter if there are no doctors or medicines, as long as one is in good health. Nor does the threat to freedoms weigh heavily if they contribute nothing to everyday life. Criticism of the benefactor does not dent the spirit, and its defense is a priority.

That’s why the peso fell as did the stock market, and the speech of Ramírez de la O did little to calm the markets. This situation, of course, is not understood by large sectors of the population. But it is a clear message against centralism.

Why? Because it is perceived that before leaving power, AMLO wants to reform the Judiciary, which would end the last counterweight to unconstitutional decisions, to exercise power fully. And that, here and in any country in the world, is to end the rule of law. This destroys investor confidence because contracts that are made have no guarantees of certainty or legality.

AMLO, thirsty for power and in full revelry, wants a ‘black September,’ where with a qualified majority he can push his plans for constitutional reforms. The opposition could not stop him in Congress and would again turn to the SCJN, which would be subject to legislation that destroys it. In fact, Claudia Sheinbaum may win the majority of the ministers after the departure of Minister Aguilar, and would obtain control of the SCJN. But AMLO wants to end the Judiciary and completely subjugate it, not only the constitutional court but all levels of judges and magistrates, creating a caricature of what the judicial career is today.

So, the destruction continues, and without counterweights, we return to the imperial presidency. There is still the counting of ballots and polling stations that began yesterday and will last several days. Social networks already point out several errors, many with malice, and it will be seen what can be recovered with this exercise. The feeling of frustration and fraud persists because Xóchitl gained the support of the middle classes and awakened, along with civil society organizations, many sectors of the population that mobilized to vote and win not only the Presidency but to be a counterweight in Congress.

And they do not plan to go back to staying at home. Claudia thus faces two limitations that she must resolve. The internal one is: how to coexist with a movement of citizens in the main cities to achieve peace and avoid confrontations that can lead to clashes and violence. The external one is: how will the markets react to the disappearance of the rule of law. Nearshoring will be halted, and Mexico will miss a moment that will not be repeated to become a world power and remain stagnant, and perhaps with worse conditions in its trade with the North American bloc.

Mistakes are costly. Claudia faces very difficult decisions: to lower foreign debt, increase internal revenues perhaps with a tax reform, to resolve whether to continue financing the bankruptcy of Pemex or to open investment in exploration to rescue it, whether to continue subsidizing AIFA and Mexicana de Aviación, whether to finish the Maya Train and what will be its benefit. All with limited public finances that can be tightened due to lack of investment. Recovering certainty to attract capital will depend on the direction of the economic model that is taken. And of course, there is the problem of security throughout the country.

And the pressure of social aid that will demand more resources, pensions, which are today a black hole in public finances, since neither ISSSTE nor IMSS can fund them. There is the temptation to appropriate the Afores to be able to advance in the infrastructure necessary to concretize nearshoring, which will generate discontent among workers, as their savings will not necessarily have positive increases over inflation, and their pension will be reduced to a minimum wage, perhaps also funded with public resources.

Claudia has a responsibility to Mexico. How will she assume it? With more centralism and authoritarianism, persecuting criticism, or will she open doors to a dialogue with opponents. Will she destroy the rule of law with the costs of international isolation that this will produce, via the markets? Will she decide, on the contrary, to strengthen legal certainty by strengthening powers and counterweights. Or will she end up taking control of everything, including the electoral process and the disappearance of plurality through regressive electoral reforms.

We do not have the answers because Claudia has not really spoken. She has submitted to the power of AMLO. But there is doubt as to whether she will really continue with the destruction, supported by more than 25 million beneficiaries of support, or if she will open spaces for plurality and democracy, or if it is serious that she thinks that only she and her allies are democrats. We will soon know. And then we can assess whether the precipice is so deep, or if there will be opportunities to recreate national unity, which is absent today.

The truth is that it was a state election, but the majority prevailed, beyond what was imaginable. However, nothing can be as before because there is an active citizenship committed to Mexico. Turning a deaf ear to those who generate more employment and well-being for working families does not seem to be a democratic path. And moreover, the markets will react to the development model, which will aggravate the debt payment and drive away investment if the balance of powers and legal certainty disappear. So even though AMLO plans his ‘black September,’ Claudia will be directly affected by the decisions. There we will see what she is made of.

By Rosario Guerra

Source: El Financiero