The denial

Luis Rubio

A few years ago, when Beijing was getting ready to receive the heads of government that make up APEC, the city government closed hundreds of factories and banned the circulation of millions of vehicles, all in the interest of reducing air pollution and trying to give it a less dirty facade to the city. Despite these efforts, a telephone app that published the pollution index of the big city showed scandalous numbers, far superior to those tolerable according to the World Health Organization. The government did not take long to solve the problem: it blocked the use of that application and with that it gave a holy sepulcher to the pollution.

This is how President López Obrador appears to act. Instead of solving the country’s problems, he is determined to destroy everything that already worked and, in many cases, worked extraordinarily well. The country was on the right track, even with huge shortcomings and unresolved issues, but significantly better than it was in the seventies and eighties. Now the objective seems to be to break the dishes, destroy everything that exists and pretend that the problems are solved by themselves.

The strategy of labeling everything as evil and corrupt already paid off in the form of increasing unemployment, an economy that is going down and a total absence of new investment, which only worsens the first two indicators. The president is not willing to acknowledge that his strategy is causing these phenomena and that, if it continues, it will not succeed but to plunge the country into a crisis of immeasurable dimensions. The signals sent by the financial markets regarding the reliability of the Mexican debt are not promising; rather, they anticipate risks that, if not addressed immediately, will cause just what the president says he wants to avoid.

The problem is not Pemex’s finances, even though that is a huge problem. The problem is the whole conception of the government, which wants to destroy what exists, when what the country requires are actions that resolve current and ancestral problems that nobody has wanted to face for a long time and for which the President has the legitimacy needed. The economic strategy of recent decades is the only one possible, although it would have to be carried out better: it is no coincidence that, literally, all the nations of the world have gone down a similar path. The exceptions are precisely the examples that we should not want to imitate, such as North Korea and Venezuela. Even Cuba has entered into the logic of globalization, albeit modestly.

The starting point for AMLO is that everything that was made after 1982 was wrong. That premise errs on two fronts: first, he does not recognize that the crisis of 1982 resulted from prolonging for too long -and, in fact, exacerbating- the strategy of stabilizing development, to the point of provoking a debt crisis that took decades to control. Secondly, he does not accept that the strategy of introspective, almost autarchic development ceased to be sustainable because it did not meet the needs of an increasingly demanding population, and because the world changed with communications, technology and the way of producing. The strategy adopted after 1982 has many shortcomings and errors, which need to be addressed, but it is the only one possible.

President López Obrador has the legitimacy and leadership to do what governments of past decades could not or would not do: eliminate the obstacles to development that were preserved and protected and which lie at the heart of the low rate of growth (in average) that the country has sustained for too long. The problems that the country faces have to do with stagnant political and social structures that favor what Luis de la Calle* calls the “extortion economy,” where authorities, unions, monopolies, bureaucracies and criminals extort money from citizens, businessmen, students, proprietors and merchants, thus preventing companies from growing and the country from developing. If the president really wants to trigger high growth and give opportunities to the most disadvantaged Mexicans, his strategy should be to break with this impunity.

What he is doing is exactly the opposite: he is strengthening fiefdoms, encouraging (and rewarding) trade unions that hinder everything and cultivating and captivating companies that impede competition. Causing union conflicts, attacking companies that generate energy and stoking a polarized environment will only achieve less growth, less investment and, if the destruction of everything existing persists, a crisis of the dimensions of 1995. Or worse.

Oaxaca does not progress because the social, political and union structures all interfere and create obstacles to development. One needs no more than to observe what drives successful places like Aguascalientes or Querétaro to see what a favorable political, social and business environment can create. The question is whether what President López Obrador wants is to convert the whole country into Oaxaca, the path he has adopted, or to confront the problems of Oaxaca and, in general, of the south of the country (although not exclusively) so that the whole country can join in the high rates of growth of the aforementioned states, the only way the most disadvantaged citizens may end up having the same opportunities and rights as the most successful. In a word: leveling the field from the bottom up or from the top down?