Changing the Model

NEXOS – Luis Rubio

Over the last four decades, Mexicans had it all: governments that had no idea what they were doing and that ended up causing profound economic and social crises  (LE-A and JL-P), governments that dealt with crisis and strove to do the best possible (M-DLM and EZ), governments that understood the reality and sought to change it radically (C-SG) and governments that attempted to change but that lacked the interest or the vision (VF-Q) or the capacity (FC-H) to achieve it. What we hadn’t had was a government with the capacity and disposition for change but without the least concern for the reality that they were endeavoring to alter.

The point of departure of today’s government was simple and overwhelming: the country has not been advancing, the economy exhibits a very poor performance, poverty has not been diminished and the political structures don’t respond to the needs of the country nor do they resolve its problems. In a word, the country is adrift said the then-presidential candidate and to alter that course requires an effective government. Whether one shares the adopted strategy or not, no one could dispute the essence of the diagnosis.

What is significant is not the diagnosis or the fact that, beyond the  general indicators from which the statements of the previous paragraph derive, the solution proposal, the strategy followed throughout this first year of government, does not respond to a specific analysis of what exists, to a calculation of the economic or social variables, or to an analysis of the dynamic that characterizes the country in general and each of its components, but it is rather the product of the comparison of how the country operated “when it did function” with the current situation. The relevant comparison that today’s government is encountering is not surprising given the personal biography of the president and his home state, is with the era of stabilizing development (1940s-1960s). What’s apparent about that era is eloquent: order, high economic growth rates, little political conflict and a government with the capacities necessary to preside over the destiny of the country and to act in the face of its challenges.

My hypothesis is that the roadmap of the government arose from that conception and that its strategy resides in the reconstruction of the structures and characteristics of times long past with the objective of converting the president into the heart of the State and the government into the factotum of economic development. That is, it’s about a political response –a search for power- to the problematic that the country is experiencing on all fronts, a factor that perhaps explains the emphasis on matters of power as well as the absence of specific projects on matters that overwhelm the population, such as public security, justice, corruption, bureaucratic abuse and the appalling performance of the system of public expenditures at all levels of government.

With that rationale, the government’s first stage consisted of establishing a sense of order, a hierarchy of authority and a strong presidency a cut above the everyday strife. To advance it made exceptionally skillful use of communication to undertake initiatives that range from the implantation of form as a basic element in political relations (perhaps the best example of this was the extraordinary care with which the inaugural ceremony was organized) up to the arrest of the teachers’ union leader and the construction of the so-called Pact for Mexico. The government faced up to instituting itself as the political heart of the country, imposing conditions of dialogue with its counterparts, limiting the “de facto -or veto- powers”, canceling channels of alternate communication, stipulating rules for big business, marking a distance with the U.S. government and some of its agencies and, in general, placing itself above interests that, in the governmental diagnosis, had grown at the expense of the State.

The strategy unfolds with that same power criterion in each area of governmental activity. In the case of the economy, the priority interest is expanding public expenditures, thus the categorical imperative for the government rested on increasing fiscal tax collection and reducing the spending available to consumers and businesses. In a word, the development project is the government. The government is changing the development model of the past two-odd decades to one no longer based on market criteria but in a strategy of power as a means of achieving development. The new model is political to a greater extent than economic and the wager consists of whether its benefits will translate or not into a higher economic growth rate than that reached in past decades.

To the government’s credit, it can be said that for some time the need has been evident for a change in direction for the simple reason that what there was wasn’t working. The relevant question is whether the shift of course that the government has executed in the development model is likely to achieve, in the words of President Peña, the transformation of the country. It is evident that one of the great deficits, if not the main one in recent decades, has been precisely the absence and ineffectiveness of the government. In this respect, it is clearly necessary to reestablish a sense of order and authority.

The problem is that it is not only effectiveness that is necessary; a suitable project is also required. Within this context, the meager results to date should not come as a surprise. The government has promised effectiveness but has come up short, not only in realities but also above all in its project. Reforms have not been aligned with each other and often are lacking in substance. The country is much more complex that the State of Mexico and, as illustrated by presidential decisions and results in matters such as housing, the economic growth rate, the fiscal miscellany and the way it has permitted those opposed to different reforms to join forces, leadership has been much less effective than the discourse promised. The play-off between rhetoric and reality could lead equally to an integral project review, which would be desirable, and to a new vicious circle of inflation, leadership and crisis, multiplied by the political conflict and insecurity that underlie these.

The world has changed dramatically in the five decades since the so-called “stabilizing development” development model breathed its last owing to exhaustion. From this perspective, no matter how indispensable the government’s strength were to be, the characteristics that today make countries successful transcend the fact of possessing an effective government: the existence of an effective government is a necessary condition for development to be possible, but it’s not enough. With all of their avatars, what makes nations like Korea, Indonesia, Ireland, Poland, Colombia and Chile successful is the leadership quality that their governments have achieved. That leadership has served to persuade their populations, to convince them of their projects and, in a word, to procure the legitimacy of the government and of the governor. That leadership is not especially economic: it’s not the public expenditure that exerts an impact on the citizenry, convinces unions to accept governmental mediation and confers certainty on investors so that these will commit substantial resources with a long-term view.

What makes the government successful is that it is effective in what essentially corresponds to it and that implies solutions for fundamental problems –security, physical infrastructure, justice, education, etc.- and that all social actors will be brought on board (utilizing all the resources necessary). Development is not a power project: it is a result of the effective action of the State.

The success of the government will not depend on how many reforms it passes –a poor measure of comparison with former governments- but instead on the problems that these reforms resolve. To date, the tenor of the current government, above all in the legislative terrain, has been more an exercise of power –to demonstrate that this government indeed has the capacity to achieve basic reforms- than of advancing a coherent, profound and continuous project of transformation. The difference doesn’t lie in the capacity of political operation (condition sine qua non to make development possible) but in the substance of its project. This might appear to be the same thing but it isn’t.