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Mexico’s Oil Belongs to Its Citizens, Not the Global 1%

Mexico's oil

Thousands of people march in Mexico City in protest of the privatization of Mexico’s oil industry. Photo by flickr user eneas, March 18, 2013.

By Yoshua Okón | Creative Time Reports | March 18, 2014

Mexico City, Mexico – Oil in Mexico is much more than a symbol of national pride. For the past 75 years it has been an enormous source of income for developing Mexico’s infrastructure and improving social welfare. When, on this day in 1938, President Lázaro Cárdenas expropriated U.S.- and U.K.-owned oil companies, he allowed Mexico to achieve relative independence and modest prosperity. The nationalization of oil saved Mexico from becoming a paralyzed, essentially colonized country like Guatemala, which has a major mining industry that is almost entirely foreign-owned.

Petróleos Mexicanos (PEMEX), the state-owned company with exclusive access to Mexico’s oil, is one of the most lucrative companies in the world. In 2012 it declared profits of over 900 billion pesos (or $70 billion), earnings comparable to those of American oil and gas giants like ExxonMobil and Chevron. More importantly, PEMEX has historically distributed its profits among the Mexican population more equitably than any other industry in the country. Sixty percent of Mexico’s spending on social welfare comes from oil income. Among the things this income currently pays for are education, health care and programs to fight extreme poverty. Every Mexican citizen owns PEMEX, and the profits the company generates have made palpable differences in all of our lives.

Lucrative as it is, PEMEX could make and distribute much greater revenues if it were not so corrupt, inefficient and archaic. We have long known of grave problems with the oil industry and union, such as losses in refining and production. (Output has fallen 25 percent since 2004.) If PEMEX isn’t brought up to date in the next few years, there is a serious danger that the company will collapse. But instead of reforming the institution, the current government has exploited PEMEX’s deficiencies under the guise of reform to fiercely promote a very different agenda: the privatization of oil in Mexico.

Far from modernizing PEMEX, eliminating corruption or directing more income to Mexico’s citizens, the so-called energy reform passed by Congress and signed into law by President Enrique Peña Nieto in December will radically shift the distribution of oil profits from the public to a few private investors. The bill modified Mexico’s constitution to allow private oil companies to compete with PEMEX in every aspect of oil production. Underground oil reserves will still belong to Mexico, but since all profits derived from production will go to corporations, these reforms effectively constitute a privatization. Yet the president never admitted to this underlying agenda in the lead-up to the bill’s passage; his administration has altogether avoided using the word “privatization,” in favor of vague references to “modernization” and “the need for private investment.” This lack of honesty has generated tremendous confusion among the Mexican population, greatly debilitating potential opposition to the bill.

As Peña Nieto and his Institutional Revolutionary Party (PRI) prepare a new set of bills that will implement the changes to oil laws, a multimillion-dollar publicity campaign of disinformation initiated last year by his administration still saturates the mass media, diverting the debate on “energy reform” by reducing it to obvious questions: Is reform necessary? Is PEMEX efficient? Do we need progress and modernization? As a result, we have skipped over the most pressing and fundamental questions: What should the nature of this reform be? How will profits be distributed? What measures are in place to fight the corruption that causes us to lose so much of our oil income? In order to modernize, do we have to abandon the idea that Mexican oil belongs to the people of Mexico?

The recent history of PEMEX is a story of deliberate sabotage. PEMEX managers have enabled politicians to keep a portion of the company’s profits for decades, laying the groundwork for privatization by making corruption seem like the natural result of a nationalized industry. But the underlying problem has always been and still is political corruption, not a lack of private investment. Consider Romero Deschamps, the leader of PEMEX’s union since 1989, who is accused of stealing an estimated 3 billion pesos’ worth of the union’s assets and of having illegally created secret “private” companies that undertake contract work for PEMEX. In spite of the abundant proof of his guilt, Deschamps is currently a senator for the ruling PRI. Peña Nieto claims that stamping out such criminality is one of the primary objectives of the current “reform,” but his policy for overhauling the industry doesn’t contain a single strategy aimed at fighting corruption.

The majority of the proposed structural changes to PEMEX aren’t even necessary for the task of modernizing Mexico’s oil industry. PEMEX already has access to cutting-edge technologies since private oil companies can operate in Mexico and have been doing so (for example, PEMEX is currently contracting the services of Halliburton and OHL). Whether or not PEMEX should contract private companies is irrelevant; what matters are the terms on which it partners with the private sector. The fact that the Peña Nieto administration is permitting profit-sharing contracts—which have historically been imposed on poor countries, with disastrous results—rather than limiting partnerships to licensing permits that would pave the way for increased efficiency without signing away the democratic ownership of resources, is another clear indicator of the underlying agendas behind the “energy reform.” As former PEMEX director general Adrián Lajous has argued, profit-sharing contracts render private companies unaccountable, leaving the state, its resources and its people vulnerable.

Peña Nieto presents his “reform” as the magic solution to PEMEX’s problems, as if the neoliberal dream of privatization without regulation were synonymous with social justice, economic well-being and democracy. But the facts paint a very different picture. Since neoliberal policies surged in the 1980s and former president Carlos Salinas de Gortari signed NAFTA into law in 1994, a weakened state, incapable of protecting the environment and the rights of its poorest people, has created the perfect conditions for political and corporate corruption. We live every day with the consequences of Carlos Slim’s acquisition of Telmex, the telecommunications company that Salinas privatized in 1990. Because there is little regulation, prices are high and service is poor, and Slim is now one of the richest men in the world. Another dark legacy of Salinas is his privatization of the banking sector and creation of Fobaproa, an agency intended to prevent banks from going bankrupt. After Mexico’s 1994 economic crisis, the institution of Fobaproa meant that the public paid off banks’ massive debts. High-ranking politicians and businessmen have pocketed extraordinary profits, while everyday people have borne greater economic burdens, with each move to privatize. The result is a spectacular growth in inequality. More than 53 million people in Mexico today—nearly half the country—live in poverty, and 11.5 million Mexicans live in extreme poverty. Meanwhile, the eleven richest men in the country have accumulated roughly 11 percent of the GDP.

We cannot undertake true energy reform in Mexico without first undertaking political reforms that would decisively and effectively tackle corruption. Sadly, because it does nothing to change political structures and curb corruption, the current legislative process is taking us further away from democratic values and constitutes a huge step in the wrong direction. Approved by politicians who never consulted voters, the bill passed in December opens the field for companies that are known the world over for their abusive practices and for co-opting politicians (ExxonMobil, Shell, BP, OHL) to operate in Mexico without regulation or restriction. In the words of the historian Lorenzo Meyer Cossío, we are opening the door to “mercenaries.” The Mexican government expects its citizens to place ownership of our hydrocarbons in private hands, without our agreement and in exchange for minimal revenue. But modernization does not require that we give up our resources. Improvement shouldn’t entail changing the basic principle that natural resources belong to us all.

The “energy reform” currently under way is a huge step toward greater inequality, environmental devastation and the loss of economic and political independence for Mexico. It is one example of the neoliberal fantasy of unregulated capitalism that has landed us in our present situation, in which the 85 richest people in the world hold the same amount of wealth as the 3.5 billion poorest. We are living through the greatest inequality in the history of humanity and unprecedented ecological destruction. To combat this urgent situation, we need to strengthen fragile regulatory structures by creating independent, democratically owned institutions. By instead dismantling the few supportive social structures left, Peña Nieto’s government is pushing Mexico to a dangerous place. Against a backdrop of extreme poverty and social injustice, the PRI’s “reforms” will, sooner or later, lead to revolt.

Translated by Georgia Phillips-Amos.

This piece was made possible, in part, by the Andy Warhol Foundation for the Visual Arts.

March 21, 2014 Posted by | Corruption, Economics, Timeless or most popular | , , , , | Leave a comment

Mexico Opens Energy Industry to Foreign Investment

By Diego Cupolo | Upside Down World | December 13, 2013

In a historic move, Mexican congress members have voted to open the state-controlled energy sector to foreign investment for the first time in 75 years. On Thursday, President Enrique Peña Nieto applauded the legislation, which is poised to become the nation’s most significant economic reform since the North Atlantic Free Trade Agreement.

“The energy reform marks a fundamental transformation that will allow us to increase our energy sovereignty and self-sufficiency in Mexico,” Peña Nieto wrote on Twitter Thursday morning. “It will also drive productivity, economic growth and job creation in Mexico.”

The legislation will alter several articles of Mexico’s Constitution, allowing private multinationals to develop the country’s oil and natural gas resources for the first time since 1938, when former President Lazaro Cardenas nationalized the energy industry with the creation of Pemex, or Petróleos Mexicanos.

Though Mexico still owns its natural resources, foreign companies such as Exxon Mobil Corp. and Chevron Corp will be able to search, drill and open gasoline stations under contract with the Mexican state.

The end of the Pemex energy monopoly is expected to bring Mexico an additional $20 billion in foreign investment per year as multinationals race to tap vast deepwater oil reserves in the Gulf of Mexico. According to the U.S. Energy Information Administration, the region is the largest unexplored oil patch outside the Arctic Circle.

Yet in a country where local oil production has long been a source of national pride and is often equated with sovereignty, the reform has been heavily contested by opposition leaders from the Party of Democratic Revolution (PRD), who have said the measure should go before a national referendum.

“We warn all private, national and, above all, transnational businesses and companies that want to come and invest in Mexico and petroleum, in order to expropriate Mexican petroleum, to think again,” said Jesus Zambrano, president of the PRD. “The most probable outcome is that within a year and a half, a recall referendum will reject this change.”

On Thursday, PRD members blocked the entrances to the lower house’s main voting hall to prevent discussion of the bill. Antonio Garcia, a PRD lawmaker, even stripped down to his underwear during to symbolize a nation stripped of its wealth.

Regardless, members from the ruling Institutional Revolutionary Party (PRI) and the conservative National Action Party (PAN), met in an adjacent conference room where they passed the legislation with 353-134 vote. Peña Nieto is expected to sign the bill in February after it has been ratified by state legislatures.

Currently, Mexico is the 10th largest oil producer in the world and proponents of the reform say it could propel the nation into the top five by taking advantage of new extraction and deepwater exploration technologies that Pemex cannot afford.

After peaking in 2004, Mexico’s oil production has declined by 25 percent to 2.5 million barrels a day. During the same period, Pemex has more than doubled operational spending to $20 billion per year, gaining the company a reputation for inefficiency and corruption.

Still, Pemex revenues provide a third of Mexican government’s annual budget and the company’s 160,000 employees face an uncertain future as lawmakers finalize the reform details, which include the removal of all five representatives of Pemex’s worker’s union from the company board.

To put the PRI agenda in perspective, The Financial Times said “energy is the climax of a sweeping agenda of reforms, including telecoms, labor, tax and education, which Enrique Peña Nieto has championed in his first year as president.”

Sources:
El Pais: México cambia su historia energética a contrarreloj – http://internacional.elpais.com/internacional/2013/12/12/actualidad/1386888542_011957.html
Bloomberg: Mexico Passes Oil Bill Seen Luring $20 Billion a Year – http://www.bloomberg.com/news/2013-12-12/mexico-lower-house-passes-oil-overhaul-to-break-state-monopoly.html
New York Times: Mexico’s Pride, Oil, May Be Opened to Outsiders – http://www.nytimes.com/2013/12/13/world/americas/mexico-oil.html?hpw&rref=business
Financial Times: Mexico courts foreign investment with energy reform – http://www.ft.com/intl/cms/s/0/e2242e2c-632e-11e3-886f-00144feabdc0.html#axzz2nIk7FhZe
Wall Street Journal: Mexico Congress Passes Historic Energy Bill – http://online.wsj.com/news/articles/SB10001424052702303932504579254013051981266

Reuters: Mexican Congress passes radical shake-up of oil industry – http://ca.reuters.com/article/businessNews/idCABRE9BB16820131212

December 14, 2013 Posted by | Economics | , , , | Leave a comment

Mexico: Fight Over “Energy Reform” Heats Up

Weekly News Update on the Americas | December 8, 2013

As of Dec. 8 the Mexican Senate was set to begin debates on President Enrique Peña Nieto’s plan for opening up the state-owned oil and electric companies, Petróleos Mexicanos (Pemex) and the Federal Energy Commission (CFE), to greater participation by foreign and Mexican private companies. Supporters say the “energy reform” will bring needed capital investment and technical expertise to the energy sector, while opponents consider it a disguised plan for privatization, especially of oil production, which President Lázaro Cárdenas del Río (1934-1940) nationalized in 1938.

The legislative proposal–worked out by the governing centrist Institutional Revolutionary Party (PRI) and the center-right National Action Party (PAN), which together hold a majority in the Congress—includes changes to Articles 27 and 28 of the Constitution. Article 27 asserts state control over oil, gas and coal and bans the granting of concessions; the proposal would add a qualification that private companies could share in profits, could be paid in cash or barrels of oil and could count their share of oil reserves as assets. Article 28 would no longer define the refining of oil and the generation of electricity as strategic activities. According to opponents, the changes to Article 27 would create de facto concessions and the changes to Article 28 would allow private companies to compete with Pemex and the CFE. Opposition in the Senate is being led by Sen. Alejandro Encinas of the center-left Party of the Democratic Revolution (PRD) and Sen. Manuel Bartlett of the small leftist Labor Party (PT). (La Jornada (Mexico) 12/8/13)

Since the beginning of December protesters have organized daily picket lines outside the Senate and the Chamber of Deputies to express their opposition to the “reform.” The National Regeneration Movement (Morena), a new center-left party which broke away from the PRD in 2012, is sponsoring the street protests, with support from PRD and PT activists and grassroots groups. The movement suffered a setback in the early morning of Dec. 3 when Morena founder Andrés Manuel López Obrador (“AMLO”) was hospitalized with a heart attack and underwent surgery. A two-time presidential candidate and the head of government of the Federal District (DF, Mexico City) from 2000 to 2005, López Obrador was released from the hospital on Dec. 7; his doctors said the patient’s progress was satisfactory but told him to rest at home for four weeks. His son, Andrés Manuel López Beltrán, and Morena president Martí Batres are now leading the protests. (LJ 12/8/13, 12/8/13)

The Congress has nearly completed approval of another set of sweeping constitutional changes. On Dec. 3 the Senate passed a measure that would allow reelection of federal legislators for up to 12 years; currently they cannot stand for reelection after one term–six years for senators and three years for legislative deputies. Presidents would still be limited to one six-year term. The changes would also allow independent candidates to run; now candidates need to be nominated by registered political parties. The measure passed the Chamber of Deputies on Dec. 5 with support from the PRI, the PAN and part of the PRD, but the legislation was returned to the Senate to iron out differences between the versions from the two chambers. The PAN has insisted on the electoral changes as a condition for its support of Peña Nieto’s energy program. (Miami Herald 12/4/13 from AP; LJ 12/6/13)

December 11, 2013 Posted by | Economics | , , , , , , , | Leave a comment

In Bed with the Bully—Consensual U.S. Surveillance in Mexico

By Peter Watt | NACLA | November 7, 2013

The revelations leaked by Edward Snowden that the NSA committed acts of espionage against top Mexican officials and the president himself have so far provoked only mild indignation from the Mexican political class. Secretary of Foreign Affairs José Antonio Meade appeared to be reassured by President Obama’s ‘word’ that he would launch an investigation into the workings of the U.S. government. Notwithstanding the incongruity that any government investigating its own internal wrongdoing would have any interest in publicizing conclusive evidence of its own criminal activity, President Peña Nieto has been reluctant to push the Obama administration further on the issue, presumably for fear of undermining Mexico’s position as a staunch U.S. economic and political ally.

Ex-president Vicente Fox, meanwhile, enthusiastically endorsed U.S. spying on Mexican politicians, claiming he knew the U.S. spied on him while he was president. Indeed, Fox took comfort in the fact that the world’s superpower monitored his every move and his phone calls, evoking the ominous adage reminiscent of all authoritarian political institutions: one has nothing to be concerned about so long as one has nothing to hide and done nothing wrong. “Everyone will do better if they think they’re being spied on,” he noted, at once reinforcing the dubious entitlement of the U.S. government to act as the world’s police force while simultaneously apologizing for the illegal activities of the NSA. Mr. Fox seems unable to comprehend the basic moral and legal truism that merely because many are involved in committing criminal activities, the moral and legal implications do not simply vanish into thin air. A reasonable observer might instead conclude that the greater the number of international government institutions that are involved in criminal activity, the more serious the problem, not the reverse. “It’s nothing new that there’s espionage in every government in the world, including Mexico’s,” Fox observed. Flummoxed as to why Snowden’s revelations have provoked outrage among the Mexican populace and investigative journalists (if not in government itself), he declared, “I don’t understand the scandal.”

One document obtained by the National Security Archive at George Washington University details Janet Napolitano’s (then Secretary of the U.S. Department of Homeland Security) official meeting with President Peña Nieto in July 2013. According to Napolitano’s briefing, avoiding discussion of NSA spying on the upper echelons appears to be a Mexican, not solely U.S., initiative. The Mexicans, the document claims, wanted to ‘put to bed’ the issue of NSA intrusions. Indeed, nowhere in the summary of their meeting does the issue arise. Instead, discussions focus on maintaining and increasing border security in order to protect commercial interests and on reducing the number of undocumented migrants entering the United States.

The listless and at times surreal reaction to NSA surveillance by Mexico’s political class demonstrates their level of craven subordination to their U.S. counterparts. One can only begin to imagine the response of the U.S. political class and media pundits were they to discover that Mexican intelligence had repeatedly intercepted the electronic communications and tapped the phones of the Commander in Chief himself.

The Mexican reaction to NSA snooping on the inner circle of government stands in stark contrast to that of Brazil’s. Snowden’s leaks provoked fury within the government of President Dilma Rousseff. She blasted the NSA tapping of her phone and interception of government communications in a fiery speech clearly aimed at President Obama at the UN General Assembly. She lambasted the NSA for spying on millions of Brazilian citizens, tapping the phones of Brazilian embassies, and spying on the country’s partly state-owned petroleum giant, Petrobras. Interestingly, she remarked that the bulk of NSA spying in Brazil was not designed to thwart potential terrorists or to undermine the activities of transnational criminal organizations, but instead, to further U.S. business interests through both international economic and commercial spying. As a result, Rousseff cancelled her planned diplomatic visit to Washington, called for an international conference on data security, began setting up a protected governmental electronic communications system, and proposed changing underwater cables so that international Brazilian internet traffic would no longer pass through U.S. territory.

Brazil’s position, of course, is a reflection of the changing nature of U.S.-Latin American relations more generally. Brazil, the emerging regional power and now less of a fixture of Uncle Sam’s backyard, can afford to take an increasingly independent stance from Washington. Several countries in the region are integrating with each other politically and economically and establishing firm trade links with China, India, and South Africa—an unprecedented dynamic which has had the effect of undermining U.S. hegemony in the region.

Mexico, however, dependent on the U.S. market for 80% of its exports, is much less able to stand up to the superpower. Indeed, Mexico’s traditional position as a subordinate and reliable ally of its northern neighbor is becoming all the more crucial in maintaining the waning U.S. empire, increasingly defensive and militaristic as it reasserts its influence over the region. With a myriad of uncertainties lying ahead for U.S. power in a region that has witnessed the birth of new left-wing social movements that have had considerable success at the ballot box, it is becoming imperative for the United States to uphold and preserve its political, economic, and military alliances as per Mexico and Colombia. In Mexico, U.S. funding for the so-called ‘War on Drugs’ has provided a convenient pretext for heavy militarization throughout the country and a clamping down on political dissent and organized popular movements. Spying and surveillance programs are key to achieving the U.S. objective of continuing and reinforcing a status quo that now sees well over half the population in Mexico living in poverty and unparalleled levels of economic inequality.

As in Brazil, U.S. spying in Mexico seems less to do with the ‘War on Terror’ and the ‘War on Drugs’—two key rhetorical tenets of U.S. interventionism—and more to do with the realpolitik of ensuring that a pliant and subservient political class, personified by Fox, Calderón, and Peña Nieto, guard the current transnational dynamics—a socio-economic system that rewards the powerful moneyed neoliberal elites on both sides of the border and keeps the poor and marginalized in their place.

There is a further aspect to the Mexican response to NSA spying which warrants scrutiny. Throughout the Cold War, the CIA and its Mexican counterpart, the DFS, shared all manner of material and intelligence on dissidents (Marxists, communists, students, guerrillas, trade unionists, peasant activists, feminists, etc.) who were often incarcerated or liquidated because, as the authoritarian and paternalistic President Gustavo Díaz Ordaz claimed, they were a threat to ‘national security.’

The current partnership between the U.S. and Mexican governments allows for a level of surveillance of which Mexico’s Cold Warriors could only dream. In collaboration with telecommunications giants, the U.S. and Mexican governments provide the wherewithal and funding for large-scale spying on the Mexican citizenry. Indeed, Mexico’s Federal Ministerial Police (PFM) has recently designed a system of total surveillance and increased storage of electronic communications. In a climate in which there exist widening socio-economic disparities, a grave security crisis, and a growing disillusionment with the status quo, both the U.S. and Mexican governments have a shared interest in forestalling the development of a widespread popular political revolt and a potential ‘Mexican Spring.’ Were there any mystery as to why the Mexican response to Snowden’s revelations was so moderate, one would only need to recall Vicente Fox’s unintentionally shrewd observation that all governments have an interest in spying on one another and on their own citizens. The lackluster reaction from Los Pinos to the NSA revelations is reflective of the extent to which Mexican elite politicians acquiesce in the intrusions, largely because they themselves use domestic spying to further their own sectional interests in a country in which, little more than a decade after the ‘transition to democracy,’ the majority of the population are excluded from meaningful political participation.

Peter Watt teaches Latin American Studies at the University of Sheffield. He is co-author of the book, Drug War Mexico. Politics, Violence and Neoliberalism in the New Narcoeconomy (Zed Books 2012).

November 7, 2013 Posted by | "Hope and Change", Civil Liberties, Corruption, Economics, Full Spectrum Dominance, Timeless or most popular | , , , , , , , , , , | Leave a comment

NSA Spy Revelations Show Need to Recast US-Mexico Security Programs

By Laura Carlsen  |  CIP Americas Program | October 21, 2013

The latest analysis of Snowden leaks from the German magazine Der Spiegel is a bombshell for Mexico.

“The NSA has been systematically eavesdropping on the Mexican government for years,” reads the opening line in the Oct. 20 issue.

The article goes on to detail three major programs that together constitute a massive espionage operation against Mexico. No one seems to have been immune from its intrusions, including two presidents.

The presidential computer network was infiltrated since 2010 when Felipe Calderon was still president. The ever-zealous National Security Agency (NSA) was apparently very proud of itself for hacking the private communications of the leader and cabinet members of an allied nation.

In a “top secret” report, its “Tailored Access Operations” division (TAO) crows:

“TAO successfully exploited a key mail server in the Mexican Presidencia domain within the Mexican Presidential network to gain first-ever access to President Felipe Calderon’s public email account”, calling it a “lucrative source” to gauge Mexican “political system and internal stability”. The leaked operation was code named “Flatliquid”.

Mexicans first found out that their nation, along with Brazil and other Latin American countries, was a major target back in September, when Brazil’s O Globo published an article by Glenn Greenwald, Roberto Kaz and Jose Casado on tapping Brazilian President Dilma Rousseff’s phone and other communications. The article noted that the NSA had Mexico in its sights too.

A specially designed NSA program spied on then-presidential candidate Enrique Peña Nieto to find out who he was planning to appoint to his cabinet and how he’d handle the volatile drug war—the cornerstone of US policy in Mexico.

That caused a stir and the Peña Nieto administration sent a diplomatic note and demanded a U.S. investigation.

Sunday’s revelations add details to the previous information and show a far vaster and more insidious operation than was first imagined. Text messages from Peña Nieto’s cell phone—85,489 to be exact, according to the Der Speigel-Snowden report were harvested and organized into data bases, identifying nine close associates for surveillance and analysis.

A third program called “White Tamale” dates back to 2009, when the NSA managed to hack into the emails of high-level officials in the now-defunct Public Security Ministry.

“In the space of a single year, according to the internal documents, this operation produced 260 classified reports that allowed US politicians to conduct successful talks on political issues and to plan international investments.”

The documents note that the spy operation allowed the NSA to gain access to  “diplomatic talking points”.

What does this mean? Wouldn’t using ill-begotten private communications in negotiations be something akin to blackmail?

In any case, it seems to have fulfilled its purpose because during the subsequent period U.S. intelligence, military, police and drug enforcement agencies achieved an unprecedented margin to operate in-country, effectively breaking down any remaining resistance to their activities on Mexican soil.

The Der Speigel article states that in spy operations in Mexico, “the drug trade” was given top priority level, while the country’s “political leadership”, “economic stability” and “international investment relations” received number-three priority rankings on a scale of five.

This latter category gives credence to charges from Brazilian President Dilma Rousseff that the NSA used its apparatus for industrial spying, seeking advantages. Her charges are borne out by documents that show that Brazilian oil company, PETROBRAS, was a target of U.S. espionage. The Mexico revelations were more general but also indicate economic espionage.

The NSA, as reflected in its own documents, seems to have no sense of boundaries—it qualifies its invasions as unqualified “successes”. Der Spiegel quotes another document that reads,

“These TAO accesses into several Mexican government agencies are just the beginning — we intend to go much further against this important target.”

It goes on to state that the divisions responsible for this surveillance are “poised for future successes.”

Mexico’s Muted Response

The response from NSA to questions was predictable,

“We are not going to comment publicly on every specific alleged intelligence activity, and as a matter of policy we have made clear that the United States gathers foreign intelligence of the type gathered by all nations.”

So far, no enterprising journalists have asked the Mexican government if it has 85 thousand text messages off of Obama’s phone.

Since September the Mexican government has known it was massively spied on by the United States. After the revelations regarding Peña Nieto’s communications and contacts with US diplomats, Mexico says President Obama agreed to carry out an investigation.

But what exactly does the Mexican government expect of this investigation? No one has questioned the authenticity of the documents. Everyone knows Snowden has them, otherwise why would the U.S. be trying to force his extradition and threatening countries offering asylum. And it seems that asking the U.S. government to investigate NSA be an exercise in futility, especially since the Der Speigel article states explicitly that the programs had presidential authorization.

Not surprisingly, Mexico’s response was widely considered weak.

So far, the response to this latest round of revelations hasn’t shown much more backbone. The foreign relations ministry called the practice “unacceptable, illegitimate and against the law”—and said it would be sending another diplomatic note.

“In a relationship between neighbors and partners, there is no room for the practices alleged to have taken place,” the ministry said.

When Der Speigel asked for a comment from Felipe Calderon, Harvard University, apparently the spokesperson for the beleaguered ex-president since it took him under its ivied wings as a Global Leaders Fellow at the Kennedy School, said it would give him the message.

A senior U.S. State Department official told CNN that the Mexican government reached out about the report, and that the two governments will be discussing it via diplomatic channels.

Peña Nieto has to react now. Brazil is taking specific steps to protect privacy from the long ear of the NSA. Rousseff has been outspoken in its indignation, taking it to the floor of the United Nations General Assembly and cancelling a state visit to Washington.

Mexico’s economic dependence on the United States under NAFTA puts the Peña administration in a tougher bind. Big business will put pressure on Peña to let it slide. The PRI is likely to be seriously annoyed, but it also knows an important part of its power base rests on its relationship with the U.S. government and economic elite, almost a tautology, as shown again in the fact that taxpayer-supported NSA spying was directed at industrial spying to give U.S. companies an edge in bidding, investing and competing.

Whatever the response, the revelations are a blow to a somewhat shaky relationship. Peña Nieto has made it clear it will not allow the same carte-blanche treatment U.S. agencies were given under former president Calderon, but he has also continued security integration and U.S. expansion under the guise of the war on drugs.

Calling into question the terms of the bi-national security relationship should not necessarily be viewed negatively. Demands for a more transparent and less military-oriented relationship between the U.S. and Mexico have been growing. The NSA documents reveal a global security doctrine that has spun dangerously out of control, with what Greenwald calls “the construction of a worldwide, ubiquitous electronic surveillance apparatus” that apparently has no qualms regarding the right to privacy or national sovereignty. Neither the Mexican nor the U.S. Congress has sufficient knowledge of what’s going on to provide reasonable oversight, and the Mexican government apparently has little knowledge of the realm of shadowy U.S. intelligence activity in its own country.

When you add in the private contractors hired under the $2 billion-dollar Merida aid package, it makes for a vast and murky world of post-Cold War conniving.

That can’t be good for diplomacy, or democracy.

Laura Carlsen is director of the Mexico City-based CIP Americas Program.

October 23, 2013 Posted by | Corruption, Deception, Full Spectrum Dominance | , , , , , , | Leave a comment

The Most Awkward G20 Summit Ever

By Dan Beeton | CEPR Americas Blog | September 5, 2013

President Obama is in St. Petersburg, Russia to participate in the G20 Summit today and tomorrow, amidst a time of heightened tensions between the U.S. and several G20 member nations. Looming over the summit are the Obama administration’s plans for a possible military attack on Syria, while Russian President Vladimir Putin has said that a U.S. military response without U.N. Security Council approval “can only be interpreted as an aggression” and UNASUR – which includes G20 members Argentina and Brazil, issued a statement that “condemns external interventions that are inconsistent with the Charter of the United Nations.”

New revelations of NSA spying on other G20 member nation presidents – Dilma Rousseff of Brazil and Enrique Peña Nieto of Mexico – leaked by NSA whistle-blower Edward Snowden and first reported in Brazil’s O Globo, have also created new frictions. Rousseff is reportedly considering canceling a state visit to Washington next month over the espionage and the Obama administration’s response to the revelations, and reportedly has canceled a scheduled trip to D.C. next week by an advance team that was to have done preparations for her visit. The Brazilian government has demanded an apology from the Obama administration. In an interview with Reuters on Wednesday, an anonymous senior Brazilian official underscored the gravity of the situation:

[T]he official, who declined to be identified due to the sensitivity of the episode, said Rousseff feels “patronized” by the U.S. response so far to the Globo report. She is prepared to cancel the visit as well as take punitive action, including ruling out the purchase of F-18 Super Hornet fighters from Chicago-based Boeing Co, the official said.

“She is completely furious,” the official said.

“This is a major, major crisis …. There needs to be an apology. It needs to be public. Without that, it’s basically impossible for her to go to Washington in October,” the official said.

Other media reports suggest that Brazil may implement measures to channel its Internet communications through non-U.S. companies. But when asked in a press briefing aboard Air Force One this morning, Deputy National Security Advisor for Strategic Communications Ben Rhodes did not suggest that such an apology would be forthcoming:

Q   The Foreign Minister said he wanted an apology.

MR. RHODES:  Well, I think — what we’re focused on is making sure the Brazilians understand exactly what the nature of our intelligence effort is.  We carry out intelligence like just about every other country around the world.  If there are concerns that we can address consistent with our national security requirements, we will aim to do so through our bilateral relationship.

Such responses are not likely to go far toward patching things up with Brazil. It is conspicuously dishonest to suggest that the U.S. government “carr[ies] out intelligence like just about every other country around the world,” as no other country is known to have the capacity for the level of global spying that the NSA and other agencies conduct, and few countries are likely to have the intelligence budgets enjoyed by U.S. agencies – currently totaling some $75.6 billion, according to documents leaked by Snowden and reported by the Washington Post.

There are also signs that the Washington foreign policy establishment is troubled by the Obama administration’s dismissive attitude toward Brazil’s understandable outrage. On Tuesday, McClatchy cited Peter Hakim of the Inter-American Dialogue – essentially the voice of the Latin America policy establishment in Washington:

Peter Hakim, the president emeritus of the Inter-American Dialogue, a Washington-based policy group, noted that Secretary of State John Kerry had visited Brasilia last month to patch things up after the initial NSA leaks but “really did not do a very good job. He just brushed it off.”

Hakim said he believed the O Globo report, and he added that “snooping at presidents is disrespectful and offensive.”

Rousseff and Pena Nieto had to issue strong statements, Hakim said. “Both have to show they are not pushovers, that they can stand up to the U.S.,” he said.

The ongoing revelations made by Snowden have affected U.S. relations with other countries as well. As the Pan-American Post points out, Peña Nieto may continue to reduce intelligence sharing with the U.S.; he also said yesterday that “he may discuss the issue with President Barack Obama at the summit.” U.S.-Russian relations, of course, have also recently become tense following Russia’s granting of temporary political asylum to Snowden.

The G20 Summit also comes just after the IMF, at the direction of the U.S. Treasury Department, changed its plan to support the Argentine government in its legal battle with “vulture funds” – meaning that U.S.-Argentine relations may also be relatively cool.

September 5, 2013 Posted by | "Hope and Change", Deception, Economics, Full Spectrum Dominance | , , , , , , , , , , | Leave a comment

Mexico’s Aging Laguna Verde Nuclear Plant a Fiasco

By Talli Nauman – Americas Program – 10/05/2013

The case of the failure of Mexico’s Laguna Verde Nuclear Plant, nestled on the jagged Veracruz seacoast, reveals the need to nix nukes and fortify public right-to-know mechanisms.

With Latin American countries still turned off to nuclear power two years after Japan’s monumental Fukushima meltdowns dispersed radioactive fallout across the ocean to them, events inside a similar facility in Mexico have fueled mounting skepticism over the potential for developing the energy technology.

Fissures, leaks, shutdowns, government secrecy, a failed upgrade, alleged bid-rigging and contract fraud at Mexico’s lone atomic power station, the state-run Laguna Verde Nuclear Plant, were vetted during the 9th Regional Congress on Radiation Protection and Safety held in Rio de Janeiro in April.

The audience of Latin American experts eager to share the information at the professional association forum starred scientists from Argentina and Brazil, which also have nuclear power plants, as well as from Venezuela, Chile and Cuba, which had made tentative moves toward establishing atomic energy stations before the Fukushima catastrophe stymied aspirations.

The irregularities at Laguna Verde came to light thanks to a courageous group of anonymous high-level employees inside the power plant and to the public information requests by their spokesperson, Mexico’s National Autonomous University Physics Professor Bernardo Salas Mar, a former plant employee and valiant whistleblower.

Some of Salas Mar’s most recent research was accepted at the International Radiation Protection Association congress in Brazil, but his university did not provide him with travel expenses to attend in person.

Salas faces high-level attempts to have him fired as a result of his persistent efforts to make public his discoveries of dangerous faults and cover-ups at the Laguna Verde plant. But Salas’ achievements speak for themselves. Were it not for his ceaseless hammering on the doors of the 10-year-old Federal Information Access Institute (IFAI), perhaps no one ever would have known about the latest incidents at Laguna Verde until it was too late.

Based on his freedom-of-information requests to the institute, Salas and Laguna Verde’s own technicians revealed in an April 19 letter to President Enrique Peña Nieto that Mexico has been defrauded to the tune of more than a half-billion dollars by the international companies that won the bid for the federal contract to uprate the two reactors at the plant located near the Caribbean port of Veracruz.

“Uprating” is industry jargon for boosting the capacity of nuclear reactors so they can generate more electricity.

The letter to the President alleges the Federal Electricity Commission purposely botched the bid letting by omitting the usual requirement for a contractor to abide by the Review Standard for Extended Power Uprates. Apparently the CFD did this to favor the Spanish company Iberdrola Ingenería and the French company Alstom Mexico, which lacked the capability to carry out the changes to the nuclear steam supply system according to standard specifications.

Employees in key positions at Laguna Verde had alerted the two previous presidential administrations to the issue as far back as 2006, communicating their “worry over the capacity-boosting work contemplated for this nuclear plant, considering it to be unreliable, risky and overpriced,” according to the letter. Still Iberdrola and Alstom got the $605-million contract to increase the plant’s power output by 20 percent.

Iberdrola announced the successful conclusion of the five-year, $605-million modernization project in February, noting that it overhauled equipment dating back to 1990, in the project that created more than 2,000 jobs.

The president of Alstom in Mexico, Cintia Angulo, was arrested a week after the announcement of the upgrade conclusion on charges of giving false testimony in an unrelated French case of non-payment.

However, the more spectacular fraud for both firms will prove to be the Mexican uprate contract, which not only failed to accomplish the goal of boosting Laguna Verde’s power output, but also left the reactors in worse condition than before, Salas and employees charge.

The Federal Electricity Commission responded to Salas’ inquiries, saying that Reactor Unit 2 would be operating at 100 percent of planned output in April and Unit 1 would be at 100 percent in May.

Nonetheless, after further information requests, Salas revealed that the National Nuclear Safety Commission has denied both reactors the licenses to operate at higher output in the aftermath of the contract, due precisely to the fact that the guidelines for the nuclear steam supply system were not followed.

Employees say the failure to follow the guidelines during the uprate cracked the jet pumps that inject the water to the core of the General Electric boiling water reactors, the same kind that melted down due to a generator system crash at Fukushima.

“The situation of the reactors is not serious yet, but operating with fissures could cause a major problem to the extent that it could endanger national security. (Remember Fukushima and Chernobyl.)” the letter to President Peña Nieto says. The employees consider it “risky and unacceptable for both reactors to continue operating with the fissures that have been encountered.”

Simultaneous suspension of operations at both reactors in September 2012 and related confusing news releases, some blaming the pump fissures, caused alarm in the communities around the installation.

Authorities first said a diesel generator breakdown was at fault for the interruption in service of one reactor, while fuel-cell restocking was the reason for a stoppage at the other.

The next day they said a clogged seawater intake was part of the reason for removing both reactors from service. An escape of hydrogen gas from a condenser was posited. And finally, officials stated to the public that the fissures in both reactors’ water pumps were to blame.

Government secrecy about details surrounding the event accentuated longstanding worries in the population near the plant. The fear of accidents and serious concerns over the ongoing situation was highlighted by an NGO’s court appeal arguing that people should be exempted from paying their light bills due to the fact that their civil rights had been violated by the lack of safety measures and accountability at Laguna Verde.

In response to Salas’ information requests, the Energy Secretariat, in charge of the Federal Electricity Commission (CFE) and the National Nuclear Safety Commission (CNSNS), said it didn’t have the answers to his questions.

Its commissions presented incongruous replies. The vagueness of the answers provided by the Federal Electricity Commission prompted the researcher to appeal to the IFAI to require revised responses.

After his second round of questioning, he was able to deduce that the cooling water intake channel had indeed filled with sediment and it had been dredged, so it did not present a hazard and did not cause the reactor operations’ interruption.

He also then could determine that the hydrogen had been released from the ductwork into the cooling water of the main generator, during the month of August. While the amount of gas was unknown, the escape was not to the atmosphere, and neither presented a danger nor was cause for halting operations.

The CSNSNS responded that the diesel generator failed when a piston stuck due to lack of lubrication resulting from a bearing problem on Sept. 12. The event did not endanger life and limb, according to Salas.

Simultaneous reloading of fuel cells at both reactors was the most likely reason for the concurrent stalling, Salas concluded after the numerous freedom-of-information requests.

While the main present dangers appear to be the fractures in the cores’ water pumps, a Jan. 11, 2013 scram (emergency reactor shutdown) remains to be inspected under the looking glass of the IFAI.

The institute created by decree in 2002 has provided important tools for shedding light on the machinations of the nuclear plant, among other formerly opaque federal operations.

Yet, as this case underscores, IFAI should strengthen its own processes in order to avoid the kind of inconsistent and self-belying responses that ensnared this most recent of many investigations into the lack of security at Laguna Verde.

Even so, that won’t protect the population from the specter of accidents or deteriorating health and safety in the advent of air and water pollution from the facility, which is located on a part of the coast with only poorly maintained roads to offer escape routes.

If Peña Nieto and company are to be more responsive to community needs than their predecessors, one way to show good intentions would be to comply with demands for conducting an emergency public evacuation drill, something that never has been done in the history of the 17-year-old nuclear plant. Another would be to take the irresponsible parties to court to establish accountability.

 

May 11, 2013 Posted by | Corruption, Deception, Nuclear Power | , , , , | 1 Comment

Mexico: US Plans to Train Commandos for “Drug War”

Weekly News Update on the Americas | January 20, 2013

Citing documents and interviews with several US officials, Kimberly Dozier of the Associated Press wire service reported on Jan. 17 that the US military’s Northern Command (Northcom) has a new special operations headquarters in Colorado, to be used “to teach Mexican security forces how to hunt drug cartels the same way special operations teams hunt al-Qaida.” A Dec. 31 memo signed by Defense Secretary Leon Panetta transformed the Northcom special operations group into the new command headquarters, which will be led by a general rather than a colonel. The staff will increase from 30 to 150.

According to Dozier, this is the latest effort by US Special Operations Command (SOCOM) head Adm. Bill McRaven “to migrate special operators from their decade of service in war zones in Iraq and Afghanistan to new missions.” SOCOM “has already helped Mexican officials set up their own intelligence center in Mexico City to target criminal networks, patterned after similar centers in war zones built to target al-Qaida in Afghanistan and Iraq,” Dozier wrote. Mexican military, intelligence and law enforcement officers have reportedly visited SOCOM facilities at Fort Bragg in North Carolina, and Mexican officials also visited a SOCOM targeting center at the Balad air base in Iraq before the US troop withdrawal in 2011, according to a former US official.

The Mexican government hasn’t expressed an opinion on Northcom’s plan to help with its “war on drugs,” but Agnes Gereben Schaefer of the California-based Rand Corporation intelligence group told Dozier that Mexican president Enrique Peña Nieto would probably support the plan. “He has talked about setting up a paramilitary force…made up of former military and police forces, which he has described as more surgical” than the current effort, Schaefer said. At least 50,000 Mexicans have died in the wave of violence that followed the militarization of anti-narcotics efforts that former president Felipe Calderón Hinojosa started at the beginning of his 2006-2012 administration. (Miami Herald 1/17/13 from AP)

January 22, 2013 Posted by | Militarism | , , , | Leave a comment

Mexico: Evidence mounts of unprovoked police attacks and agents provocateurs on December 1rst

Weekly News Update on the Americas | December 11, 2012

On December 9th Mexican authorities released 56 of the 69 people who had been in detention for more than a week on suspicion of “attacking public peace” during protests in Mexico City against the inauguration of President Enrique Peña Nieto. A total of 106 people were reportedly arrested on a day which included violent confrontations between police and protesters and widespread destruction of property [see Update #1154], but 28 were quickly released. Judge María del Carmen Mora Brito of the Federal District (DF, Mexico City) court system ordered the December 9th releases after “analyzing videos, testimonies and expert witnesses’ reports,” the DF Superior Court of Justice announced in a communiqué. (Europa Press 12/10/12)

The judge’s action followed a week of demonstrations against police repression and charges that agents had repeatedly attacked, beaten and arrested peaceful protesters and bystanders while failing to arrest the people who had been engaged in vandalism. There were also accusations that agents provocateurs had infiltrated the protests. Complaints about the police seemed to be supported by videos that circulated widely on the internet. One, a compilation by the student video collective Imágenes En Rebeldía, appears to show unprovoked police attacks, arrests of nonviolent protesters, and men dressed in civilian clothes and armed with crowbars and chains standing and walking among uniformed federal police agents behind metal barriers around the Chamber of Deputies building.

On December 6th the DF Human Rights Commission (CDHDF) reported that the DF police had arrested at least 22 people arbitrarily and that four people showed signs of having been tortured. A total of 88 people claimed to have been arrested without justification, the governmental commission said; 15 youths were charged with taking part in vandalism on Juárez Avenue even though the vandalism occurred after the time of their arrests. Among the people arrested on December 1rst was Mircea Topolenau, a Romanian photographer covering the events for a magazine. CDHDF president Luis González Placencia noted that his organization was only reporting actions by the DF police and that it was up to the National Human Rights Commission (CNDH) to investigate alleged abuses by the federal police. (La Jornada (Mexico) 12/7/12)

Two protesters were seriously injured during the December 1rst protests. Drama teacher Francisco Kuykendall Leal was hit by a tear gas canister and was hospitalized with cranial injuries. He is an active supporter of The Other Campaign, a political movement inspired by the rebel Zapatista National Liberation Army (EZLN) [see Update #832]. Uriel Sandoval Díaz, a student at the Autonomous University of Mexico City (UACM), lost an eye and suffered fractures when he was hit by a rubber bullet. “This struggle won’t end until poverty ends,” Uriel said from a wheelchair as he was being released from the General Hospital on December 6th. “An eye is nothing [when] every day thousands of human beings have nothing to eat.” (Kaos en la Red 12/4/12 from Desinformémonos; Milenio (Mexico) 12/7/12)

In related news, an online petition has been started calling on Harvard University president Drew Gilpin Faust to withdraw the offer of a fellowship at the university’s John F. Kennedy School of Government to outgoing president Felipe Calderón Hinojosa (2006-2012). Tens of thousands of Mexicans have died in the militarized “war on drugs” Calderón initiated soon after he took office in December 2006. The petition is at http://www.change.org/petitions/harvard-university-president-faust-deny-outgoing-mexican-president-felipe-calderon-employment-at-harvard

December 11, 2012 Posted by | Civil Liberties, Deception, Full Spectrum Dominance | , , , , , , | 1 Comment

Mexico: Peña Nieto Takes Office as Youths Riot

Weekly News Update on the Americas | December 3, 2012

Protests against Mexican president Enrique Peña Nieto during his inauguration on Dec. 1 quickly turned into violent confrontations between police and demonstrators that disrupted much of downtown Mexico City. The protests were called by the National Convention Against the Imposition, a coalition of groups holding that Peña Nieto’s election last July was manipulated, and #YoSoy132 (“I’m number 132”), a student movement that arose in the spring in response to the election campaign [see Update #1130]. But masked youths, many of them wearing black t-shirts with anarchist symbols, quickly became the center of attention at the Dec. 1 demonstration.

The confrontations began around 7 am near the San Lázaro subway and bus stations at the heavily guarded and barricaded Chamber of Deputies, where the inauguration was to take place about three hours later. Determined to break through the metal barriers, the masked youths threw rocks, metal pipes and Molotov cocktails at the federal police, who responded with exceptional violence, using tear gas, pepper spray and water cannons. The media reported that the agents also used rubber bullets; police spokespeople denied the reports. Many #YoSoy132 supporters moved away from the masked youths, as did the famously militant teachers from the southern state of Oaxaca, although both groups organized brigades to assist protesters who were wounded or were overwhelmed by the tear gas.

Dozens of protesters were injured. At around 10 am #YoSoy132 reported that a youth named Carlos Yahir Valdés had been killed by a tear gas canister or a rubber bullet; Adrián Ramírez, president of the Mexican League for the Defense of Human Rights (LIMEDDH), said the victim was named Carlos Valdivia and had been seriously wounded but not killed.

Eventually the youths in black moved west towards the Zócalo plaza and then on to the Palacio de Bellas Artes cultural center and the Alameda park. Along the way they smashed windows, streetlights, phone booths and ATMs; looted stores and gas stations; and battled the Mexico City police. At times passers-by supplied the protesters with bricks to throw at the police, while smiling tourists took pictures. At least one private car was destroyed and one motorcycle was set on fire. (La Jornada (Mexico) 12/2/12)

During his first day in office, President Peña Nieto announced “13 specific decisions” to improve the situation in Mexico, including a universal social security system, life insurance for heads of households, educational reforms, and revival of passenger railroads. He also promised to maintain a zero deficit in the budget while carrying out his programs. (LJ 12/2/12)

Outgoing president Felipe Calderón Hinojosa (2006-2012)–whose militarized fight against drug trafficking set off the violence in which 50,000 Mexicans died, according to critics—is planning to leave Mexico, at least temporarily. On Nov. 28 Harvard University’s John F. Kennedy School of Government in Cambridge, Massachusetts, announced that Calderón will hold a one-year fellowship at the school starting in January. “This fellowship will be a tremendous opportunity for me to reflect upon my six years in office,” Calderón said in a statement.

Calderón received a master’s degree from the Kennedy school in 2000. The Reuters wire service noted that other recent students at the school include Bo Guagua, son of ousted Chinese politician Bo Xilai, and Paula Broadwell, co-author of a book about former US Central Intelligence Agency (CIA) director Gen. David Petraeus, who resigned after acknowledging that he’d had an affair with her. (Reuters 11/28/12) Another former student was the late Guatemalan general Héctor Alejandro Gramajo Morales. At his graduation in June 1991 human rights activists served Gramajo with court papers for a federal civil suit under the Alien Tort Claims Act; nine Guatemalans charged him with acts of torture, abduction and murder during counterinsurgency operations in western Guatemala in 1982, when he was army chief of staff. Gramajo lost that and another human rights suit later in the year by default [see Update #737].

December 4, 2012 Posted by | Civil Liberties, Economics | , , , , , , | Leave a comment

Peña’s Promises

By Laura Carlsen – Americas Program – 03/12/2012

Against the sharply contrasting backdrop of violent conflicts in the streets and carefully staged official events, Enrique Peña Nieto took office yesterday. The general outlines of the plan for his six-year term, although still not detailed, reveal proposed changes not unlike the new president–mostly cosmetic and devoted to appearances on the surface.

After taking the oath of office in the Chamber of Deputies at San Lazaro and swearing in his cabinet, the newly inaugurated president appeared before guests at the National Palace in the central plaza to deliver his first speech as Chief Executive.

Peña Nieto began his speech with a rapid pass through Mexican history, citing pre-hispanic and Spanish culture, the liberal and revolutionary currents and “the recent past”. Without mentioning the PRI, he emphasized the orderly change of power since 1934 and “accelerating democracy”, ironically dating from 1968–the year his party massacred hundreds of students in Tlatelolco.

He concluded with what would be the tonic of the speech-that Mexico is “ready to take off” and “everyone agrees that we have an historic opportunity.” His speech centered on the “Mexican Moment”, the idea of a turning point when Mexico would finally enter into a period of peace, prosperity and global recognition.

He did mention the challenges along the way, stating that Mexico is a nation that “grows at two speeds, one of progress and development and the other in backwardness and poverty” and citing the lack of employment and educational opportunities. His speech included a number of specific if not detailed measures that provide fodder for analysis.

Peña Nieto began with the “five strategic points” of his new government:

1. Mexico at peace: Peña offered to “put the citizen at the center of security policy.” He referred to this as a “change in paradigm”, without mentioning the drug war by name or the 60 to 80,000 killed under this model during the Calderon administration. He promised greater coordination between agencies and an effort to combat impunity and concluded,  “There can be no security as long as there is no justice.”

2. An inclusive Mexico: Peña Nieto promoted to build an “inclusive” Mexico and close the gap of inequality so all mothers and fathers can support their families. He said Mexico should become a fair, middle-class society.

3. Quality education for all: that educates students to be responsible and committed to their communities.

4. Economic growth: through greater competitiveness, more credit, more investment in infrastructure, strengthening the domestic market and expanding the global market so Mexico can take its place as an emerging economy.

5. Mexico as a responsible global actor: Participation in the world through modern diplomacy, so Mexico becomes a factor of stability in the world and a voice that defends liberty. He also used this point to thank the leaders from abroad present.

Behind the promises

The five points are formulated in vague terms, as is usually the case with presidential promises. However, we can use what was said to anticipate the challenges and possible contradictions they pose, and gauge the political will to carry them out over the next six years.

Security policy. Peña Nieto explicitly referred to “a change in paradigm”. This is notable, since it is what the peace movement and critical analysts (CIP Americas Program among them) have been calling for for years. But there is very little in the strategic point or the “13 decisions” listed afterward to back it up.

A real change in paradigm would require two measures that the Peña government has said it will not take: withdrawing the armed forces from counternarcotics efforts and renegotiating security cooperation with the U.S. government. Peña has proposed a “gendarmery”, which is a militarized police force, or a military force charged with police duties among civilian populations. This is what Mexico already has, as the lines between police and military have been blurred precisely by the drug war. Without a plan for reducing militarization, promises to “rethink” the drug war pale.

The U.S. government has actively promoted and supported the drug war model of enforcement and interdiction through the Merida Initiative and spearheaded the massive expansion of U.S. counternarcotics activities in the country. Although both the US and Mexican governments have privately (in Wikileaks cables) and publicly admitted that the strategy has not worked — they insist it’s just a matter of time–the response is to continue with no major adjustments or real evaluations.

U.S. defense, intelligence and security companies depend on the Mexican drug war to obtain multi-million dollar government contracts. The Pentagon and other U.S. agencies have achieved unprecedented freedom to act and even direct actions on Mexican soil as a result of the Merida Initiative. The hawks in government and the war industry will not give that up easily. Peña Nieto knows that and he also knows that his nation’s economy is highly dependent on its northern neighbor. U.S. politicians worried aloud that his government would attempt to negotiate deals with drug cartels, an option which is practically impossible now due to the changes in structures of organized crime. Peña Nieto has reassured the U.S. that his administration will continue the drug war.  That means continued deaths, disappearances and social upheaval. There is no mention of redefining security or human security, although the concept of putting the citizen in the center, rather the state, could be construed as coming closer to that concept.

Referring to the need for justice and eliminating impunity is a politically correct but unsubstantiated move. Impunity underlies government institutions and the corruption of the justice system historically is a PRI construct. Impunity has to be attacked from above, because it has been condoned and even promoted from above for so long. The examples of what has happened to former PRI governors accused of serious crimes against the population such as Ulises Ruiz in Oaxaca and Mario Marín in Puebla and even Peña Nieto himself for his role in the murders and rapes in the community of Atenco are illustrative. Nothing at all has happened to them. The teflon coating of PRI politicians has been carefully preserved, with a few notable exceptions such as ex-governors Tomas Yarrington (charged and on the run) and Mario Villanueva (extradited to the U.S.), who have been prosecuted for drug war crimes at the behest of U.S. authorities.   

Economic policy:Making Mexico truly “inclusive” would require some structural changes in economic policy that are not likely to come about in a Peña government. The goal of this strategy is largely contradicted by the formula for economic growth indicated in the fourth point and in other statements by the new president.

He has committed to deepening rather than fixing NAFTA, meaning the countryside will continue to be decimated by unfair competition with subsidized U.S. agricultural imports and the state is barred from basic measures such as favoring national industries in purchases and contracting or protecting vulnerable sectors from oblivion. Strengthening the internal market while expanding the global market sounds great, very balanced, but in reality they require different, and often contradictory, policies.

For example, building a strong domestic market requires supporting national production, which is logical and needed but prohibited under neoliberal trade rules, where Mexico is a world leader in signing draconian free trade agreements. It also requires having a population with purchasing power, while emphasizing foreign investment and being competitive on a global market rigged against workers requires suppressing salaries–something Mexican governments have been doing over the past three decades of PRI and PAN governments.

The laudable goal of investment in infrastructure begs the question of ‘investment for who?’ and leaves open how the administration will deal with controversial infrastructure projects that violate indigenous and human rights. More credit would be a good idea, but up to now what little has been available has gone overwhelmingly to large and powerful producers, further skewing the distribution of income.

Improving education: This requires two major moves–devoting more public resources to education and taking on the entrenched leadership of the corrupt teachers’ union. Several analysts have stated that the appointment of Emilio Chauyfett as Secretary of Education is a blow to Elba Esther Gordillo, the life-long leader of the teachers’ union (SNTE). I am not convinced.

Gordillo is a political operator who climbed to the top by wielding the power of an enormous machine for generating votes and political clientele. This machine was created and sustained by the PRI. Her capacity to exchange favors allows her to call the shots in the nation’s education system. To change that would require democratizing the union. The principle forces to democratize do, and must, come from below. The CNTE, organized to crack open the patronage and corruption of the union, is largely anti-PRI and opposed Peña Nieto. His administration is unlikely to do anything that would strengthen the grassroots union democracy (his party blocked the transparency in union matters part of the labor reform) or permanently alienate the SNTE leadership.

Global affairs: So little of substance was said here that it’s hard to know what the Peña administration will change. The written version speaks of restoring Mexico’s rightful place in the concert of nations” as a “country supportive and committed to the best causes of humanity”. It’s anyone’s guess what that refers to. Peña Nieto told Wolf Blitzer of CNN, who pointedly asked what relations with Castro and Hugo Chavez would be like, that he would be building relations in the south and north. This is a recognition that the PAN governments were early exclusively oriented northward to the U.S. and hostile to center-left governments of the South.

Mexico has at times acted as a U.S. proxy in the region, causing other countries to view it with certain suspicion. The U.S. government has actively used the Mexican government in this sense. As the Obama administration pushes divisions in the region with the Pathways to Prosperity program that allies only nations that agreed to sign free trade agreements with the US and increasing military presence of allied countries under the drug war strategy, it will not be easy for Peña Nieto to trace a neutral or balanced foreign policy within the hemisphere, if that is indeed the objective.

Opposition organizations have vowed to shift their efforts from challenges to the elections to challenges to policies they believe are harmful to the country. The center-left leader and former candidate Andrés Manuel López Obrador refused to recognize the new president and is building a new party. The youth movement now is stunned and angered by the violent response of the police while also calling on its members to reject violent confrontation.

The most commonly heard phrase from analysts following Peña Nieto’s inaugural speech, is “the devil’s in the details”. Although Peña Nieto followed up on these five strategic points with 13 decisions that included more specific actions, he still left much room to speculate.

Political promises are often, if not usually, set aside when the real task of governing begins, and one is left to wonder if they were sincere and not practical, or designed to build an image, not a government. The PRI is well-practiced in the art of simulation, of developing a public discourse and a backroom practice.

In any case, the country and the rest of the world now have more clues as to what the return of the PRI will mean for Mexico, for the United States and for the region.

Laura Carlsen is Director of the CIP Americas Program in Mexico City http://www.cipamericas.org.

December 4, 2012 Posted by | Civil Liberties, Economics | , , , , , , | Leave a comment

   

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