Luis Rubio
In memory of Dr. Guillermo Soberón

Spanish writer Francisco de Quevedo wrote: “When we say that all time past was better, we condemn the future without knowing it”. The past was not always better, but it is easier to envision it because it stays frozen in time. The new dogma is that the Mexican economy was going very well into the 1970’s and that the subsequent economic reforms were responsible for its destruction. The so-called neoliberal model may be obsolete and may have caused innumerable failures but the notion that returning to the past will solve Mexico’s current problems is pure nostalgia. New thinking will be needed to get out from the Covid-19 pandemic downturn.

The diagnosis of economic problems requires a minimum of honesty regarding the nature of those issues requiring a solution. For example, the current assumption is that Mexico’s annual average growth rate during the past three decades (of around 2 percent) was mediocre, which obviously it was. But this average growth rate hides more things than it reveals: the Mexican economy has become ever more complex and has experienced great fragmentation, with some Mexican states growing at nearly Asian rates, while others are lagging behind.  In this respect, what must be understood is the reason behind these abysmal regional differences.

The idea that what we need is to “Mexicanize Mexico” is nothing more than an ideological catchphrase oblivious to the basic reality of the past decades. Without a doubt, the citizens of Chiapas, Oaxaca and Guerrero are totally right to protest the huge stagnation that these southern Mexican states have fallen into. In great measure, factors of real power within their own milieus have thwarted change. This in addition to what successive Mexican federal administrations have failed to accomplish. In the same manner, when one visits the states of Aguascalientes and Querétaro, the impressive transformation that they have undergone is immediately evident. The relevant point at issue is to understand what the former Mexican states have done poorly and what the latter states have done well.

Those yearning to recreate the Mexico of the 1970s are right when they say that the country is more unequal today given the contrasting growth rates between different Mexican regions. However, resurrecting the economic strategy of half a century ago is impossible for two reasons.

The first reason is that the sociopolitical and economic realities of yesteryear do not have any similarity with those of Mexico today. In the old era, growth was explained as the result of an optimal combination of government investment in infrastructure and private investment. During those years, private investment responded to a framework of certainty that was the product of a clear understanding between the factors of production and the Mexican government. It was not a perfect world but it was extraordinarily successful while it lasted.

The second reason of why it is impossible to reconstruct the Mexico of the 1970s, is that the key element rendering possible high growth rates during those years –oil production and the expectation that prices would increase permanently- are no longer present. In addition to that, Mexico’s oil production has decreased in absolute terms and its relative importance to the entire Mexican economy has radically diminished. In later decades, manufactured goods replaced oil as Mexico’s growth engine. Those Mexican states that embarked in following such path have gained jobs and new sources of income.

There are many misconceptions influencing the current Mexican government’s thinking. The first and most important, since the rest depends on this, is that Mexico abandoned the so-called “stabilizing development” economic model on ideological grounds. In fact, during the 1970s and 1980s, several Mexican administrations made ludicrous attempts to prolong the life of such economic model at a time when its foundations had already disappeared. Yet, the most important thing to remember is that it is impossible to go back to a world that no longer exists.

The central point here is to say that the reason why Mexico abandoned the “stabilizing development” model was because the economy stopped growing. While Mexico was going through an oil binge, the rest of the world changed its ways of production, advancing headlong into the world market. The subsequent reforms to the Mexican economy were nothing more than a recognition of the new economic reality. Going back in time will only deepen Mexico’s ills.

The implementation of a new model required Mexico to develop novel sources of economic certainty. The anchors that had previously sustained Mexico’s growth were wiped out during several political earthquakes like the 1982’s expropriation of private banks. The North American Free Trade Agreement (NAFTA) in 1993 was an economic development tool whose importance was based in generating trust in Mexico among investors and entrepreneurs.

Those Mexican states that joined the new economic logic -based on manufacturing- were transformed. Those that did not were left behind. The key thing to understand are the obstacles that impede investment to reach Mexico’s poorest states and thus act in consequence, not rhetorically, but in reality.

Evidence shows that factors such as property rights and the rule of law are increasingly more important for economic growth the higher the level of development (Acemoglu, 2003). If one asks an auto company what were the reasons that made them decided to set up a plant  in Puebla or in Durango (and not in the southern states of Oaxaca or Chiapas), these arguments would doubtlessly feature prominently in its answer. The key lies in certainty and political harmony.

Focusing solely on Mexico’s growth rate is a distractor given that it lets championing grandiose government projects instead of paying attention to the country’s sociopolitical complexity. The dilemma between growth and stability is a false one, as exhibited by virtually all Asian countries where governments have devoted themselves to smoothing the way towards prosperity. The issue is not an ideological one, but rather a practical one. That is the true departure point.

* Luis Rubio is chairman of the Mexican Council on Foreign Relations (COMEXI) and of México Evalúa-CIDAC. A Spanish version of this Op-Ed appeared first in Reforma’s newspaper print edition.

 Twitter: @lrubiof

https://mexicotoday.com/2020/10/20/opinion-the-nostalgic/

Luis Rubio

If politicians say it, it must be true. That is the way Mexican politics has worked during the past years: pure verbosity. One needs no more than to listen to the endless ads by Mexican legislators claiming to have fixed one problem by passing a new law. Problems suddenly vanish. If it just were so easy. Of course, many issues that are key for Mexico’s development do require legal reforms. However, the mere fact of passing a law or voicing a pompous government statement does not solve the problem. It is pure sham for politicians’ speeches. 

It is said that we Mexicans live in a democracy. This is in part true given that today Mexicans elect their leaders and legislators in clean and free elections. This is not a small matter after decades of electoral frauds and decisions from the top down. Nevertheless, the  average Mexican citizen has not improved discernibly just because of that fact. There is one critical exception: Mexican leaders have today less capacity to commit abuses than in the past. But if by democracy we understand representation, participation and limits to the leaders’ ability to commit abuses, Mexicans are very far from having arrived there.

The easiness with which current administration has been able to erase any trace of checks and balances demonstrated the frailty of Mexican democracy. Despite this, democracy liberated Mexican citizens from authoritarianism. Above all, it also gave free rein to Mexican politicians -party leaders, lawmakers, state governors, Presidents- to build a rhetorical scaffolding that never comes to fruition. It is the pretense that Mexico moves forward when, in reality, specific problems are not even clearly defined nor are they diagnosed correctly to solve them.

In their book on how the former Soviet countries in Europe evolved after the fall of the Berlin Wall, Ivan Krastev and Stephen Holmes describe how the Russian élite employed language in order not to change the status quo, that is, they built a fake democracy that allowed them to keep their lives of privilege. However, Krastev and Holmes stress that the most important aspect was that pretending living in a new democracy was entirely natural given that they have pretended that communism was democratic and worked well for the two decades prior to the end of the Soviet Union. Any resemblance to the way Mexican democracy evolved is purely coincidental.

Perhaps the most transcendental question would be whether Mexican citizens believe politicians’ rhetoric and accept it is the supreme word. Undoubtedly, many politicians not only believe their own words (and their lies), but that they also assume they become real once they utter them in public. Yet, there is a crucial element that is part of citizenship: history suggests that people believe what politicians say, until they stop doing so. Rhetoric is an inherent part of politics. However when facts on the ground do not change or when day-to-day reality does not take a turn for the better, the relationship between politicians and citizens deteriorates inexorably. The experiences of former Mexican Presidents Vicente Fox (2000-2006) and Enrique Peña Nieto (2012-2018) ought to teach us a lesson about this.  The question still up for grabs is when the same thing will happen with the current López Obrador administration.

This behavior has brought Mexico to a standstill for several decades. Instead of debating the nature of problems and potential solutions, Mexican politics has cultivated verbosity and pretense. The mediocrity that these two rhetorical elements have encouraged is not only reflected in the country’s lack of economic growth but also in believing the idea that growth is even necessary. This mediocrity is also exemplified today in the daily Presidential press conferences whose main goal is to divert attention away from relevant matters.

At bottom, the key problem of Mexico’s political system is perhaps the dysfunction (if not the absence) of a government inclined to comply with its responsibilities from the most basic, such as providing security, to those that are essential including creating the conditions for progress in the broadest sense of the term.

The phenomenon is clearly explained by Francis Fukuyama: a country’s progress depends on the existence of a competent government, an efficient system of accountability, and a democratic electoral system. However, Fukuyama asserts that the order in which these factors arrive is crucial. If a country becomes democratic before building a strong and competent state, the result will be paralysis, dysfunction and, potentially, instability.

Mexico built a great scaffolding to guarantee clean elections. However, it did not transform its system of government into one capable of guaranteeing the country’s social and economic viability. The Mexican government ended up being frail, lacking in suitable tools for the challenge, with weak and mostly powerless institutions (from the Supreme Court to independent agencies) and overwhelmed with non-institutional disputes among political actors.

Political rhetoric has allowed to disguise the fragility of the Mexican government. However, it has also impeded it being addressed as the main national priority that it should be. Worse yet, it is being taken advantage of in trying to recast the omnipotent Presidency of yesteryear that in the end left Mexico where it is now.

* Luis Rubio is chairman of the Mexican Council on Foreign Relations (COMEXI) and of México Evalúa-CIDAC. A Spanish version of this Op-Ed appeared first in Reforma’s newspaper print edition.

Twitter: @lrubiof

https://mexicotoday.com/2020/10/13/opinion-pretenses/

Luis Rubio

Karl Popper, the great scholar of democracy and open societies, wondered once: “What has to be done if ever the people vote to establish a dictatorship?” According to Popper, most democracies include clauses in their laws to prevent that from happening, such as requiring qualified majorities in Congress. Legally or not, the fact is that Mexico’s governing party (Morena) -and therefore President Andrés Manuel López Obrador (AMLO)-  has a qualified majority in the Lower House of Congress and is not far from achieving the same feat in the Senate. In a system of separation of powers, the Mexican Supreme Court was the only branch capable of preventing the consolidation of a dictatorship. Unfortunately, the court fell short.

Each branch of government within a democracy has a specific origin, a structure, and some responsibilities. While the executive and the legislative branches are elected by the people and need to stay close to what citizens think, the Supreme Court was designed to keep some distance from day-to-day things. Using the long-term perspective presented by the constitutional framework, the court examines the proposals, decisions and laws that are the subject of the other two branches. The court’s function is not to be popular but to keep a balance and break the ties between the two other branches of government.

When a branch of government endowed with such powers abdicates its responsibilities it fails society and opens the door to other abuses by the other branches. In the case of Mexico where the executive controls the legislature and routinely subordinates it to its interests and preferences, the Supreme Court was the only stronghold of constitutional protection left to citizens. With its decision last week to endorse López Obrador’s idea of a referendum to prosecute five former Mexican Presidents, the Supreme Court gave in, bowed to the will of the President, and lost all credibility. With a subservient Supreme Court now transformed into a mere clearinghouse of the President’s wishes, there is no longer need for López Obrador to push to create a separate Constitutional Court as he initially had suggested.

Instead of evaluating the constitutionality of the proposed referendum to prosecute the former Presidents, the Supreme Court chose to elucidate  “the feelings of the people” (in the words of President López Obrador himself). There are only two possible interpretations of the Supreme Court’s decision both of which are bad. The first interpretation is that the majority of the Court’s justices believe that politicizing justice is legally valid. A second interpretation is that the Court chose to avoid a conflict with President López Obrador by caving to his wishes. Both interpretations are bad news for Mexico’s democracy and even worse for the rule of law.

The referendum’s proposed question has been widely debated, so I will only highlight three points. First, the referendum is not a legal issue but a political one. President López Obrador wants to be on the ballot in the 2021 midterm election to boost his party’s chances of retaining the majority in Mexico’s Lower House of Congress. The Supreme Court has now given López Obrador what he was not able to do when he unsuccessfully proposed the idea of holding a recall referendum. It is clear to me that the last thing that President López Obrador cares about is to indict his five predecessors even when he would undoubtedly like to see one or two in jail for strictly personal reasons. Second, there is enormous resentment against various former Presidents, partly fueled by López Obrador himself but also in large part by Mexico’s 1994-95 financial crisis and the 2006 Presidential election. Instead of changing reality and solving those grievances through better public policies to improve the quality of life of citizens, López Obrador has opted for a strategy of confrontation and distraction. The referendum to prosecute the five former Mexican Presidents fits this purpose like a glove. Finally, the Supreme Court’s ruling opens the door to any matter be subject of a referendum. It will surely occur to many that new referendums could be used to deal with things like the poor performance of the López Obrador Administration, the current government’s corruption, water rights in Chihuahua state or the management of the Covid-19 pandemic.

One of the peculiarities of power in Mexico is its excess. Mexican Presidents (and especially the current one) enjoy an almost unlimited power, free from checks and balances, which makes them believe that they are omnipotent. To the extent that their actions foster and nurture that sense of absolute power, Presidents begin to believe that their reality is permanent, indisputable, and legitimate. Their advisers and officials become complicit (conscious or not). The mere fact that President López Obrador believes that there is no corruption in his government is an early sign of this fact.

History, however, teaches us another lesson. Only when they are no longer in government (and usually in a bad way), Mexican Presidents begin to realize the mistakes, costs, and deficiencies that happened during his term in office. That is the time when the attacks and demands against them begin: right when they are no longer in control of those government tools that can vindicate them. It never fails.

There are two big losers of last week’s Supreme Court’s decision. First and foremost, Mexican citizens who (whether they recognize it or not) always benefit from the rule of law, now further weakened. The other big loser is, paradoxically, the President himself, whose acts can now be inexorably subject of a referendum.

* Luis Rubio is chairman of the Mexican Council on Foreign Relations (COMEXI) and of México Evalúa-CIDAC. A Spanish version of this Op-Ed appeared first in Reforma’s newspaper print edition.

 Twitter: @lrubiof

Opinion | Falling short

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Luis Rubio

“Each generation doubtless feels called upon to save the world” Albert Camus begins saying in his speech on obtaining the 1957 Nobel Prize in Literature. That is the spirit with which Mexican President López Obrador appears to have undertaken his government: change everything. There were good reasons to change what did not work, thus opening an opportunity toward the integral development of the country. But instead of following that route, he has dedicated himself to the destruction of what exists, which entails profound and serious consequences for the future.

There is no doubt that the president inherited an infinity of problems and maladjustments, but also some very successful and functional assets. However, his logic has been to deny any value whatsoever to what exists without even the offer of an alternative. As a method of distraction, it is a diversionary tactic that is potentially effective, but only for the short term. Four long years from the conclusion of his six-year term, the country requires more than distractions.

First the distractions. By nature, the president confronts and stigmatizes: he does this with the economy, with former presidents, with the business community, and with the entire gamma that what he groups, using one of his favorite words, the “adversaries.” As a strategy of government, it is a useful instrument, as long as the essential works, that is, that the economy runs in reasonable fashion, that at least indispensable jobs are created and that the citizenry enjoys sufficient satisfiers in their daily life. The problem is that the essential is not working and, in fact, it has begun to spring leaks, not only because of the pandemic, but also due to the lack of investment. Because of the manner in which he disposes of public funds (transfers to electoral clienteles with little or a null multiplier effect) the government does not possess the capacity to invest, and because of the way that he frightens investors, nor is there the materialization of private investment. One must question oneself as to what benefit there is in confrontation.

Second, the rhetoric does indeed matter: presidents, in the way they communicate, fabricate political facts and more so in a country with institutions so weak that the president has summarily thrust them aside. The presidential vernacular alienates vast sectors of the population, reverting into criticism of the president himself, as well as into the absence of opportunities for the completion of economic projects. Expectations are highly negative and overcoming them will become increasingly difficult. In a country with the demographic profile of Mexico, with so many young people, six years without the creation of jobs represents an enormous sociopolitical risk. So great is this that one of the targets of the president’s clientele strategy are precisely unemployed youths. But if the economic trends proceed as they have to date, there will soon be no sufficient budget for so many unemployed persons, young or old.

Third, the presidential popularity is not fictitious, but it is also not immovable. Everything indicates that this popularity is sustained on two mainstays: before anything else, on the credibility of the president and his history of denouncing problems such as poverty and corruption. Many Mexicans not only believe him, but they abhor the traditional political alternatives, forcing them to stay where they are, even while many of them are already nursing severe doubts concerning the viability of the governmental project. On the other hand, the strategy of monetary transfers to populations such as that of older adults and young people are not so innocent: they follow a strictly political and electoral rationale. It is very probable that these transfers will not reduce poverty nor will they avoid the recruitment of young people by the narcos. But in terms of an exchange of money for support, these programs are potentially infallible.

Finally, an economic rebound should not be confused with a recovery of the economy. The size of the collapse is such that it is natural, simple logic, to expect a rebound during these and the upcoming months. However, a rebound does not imply a recovery, which is always accompanied by investment, growth in employment and a rise in consumption. None of this is possible to discern at present, the reason that the most benign and optimistic of prognoses are terrible. Without a change in political strategy, the economy will not be able to recover in ensuing years.

I return to the beginning: no one can doubt that the president inherited huge problems, which he himself summed up as poverty, inequality, corruption and low growth. All of these are real problems that merit an integral strategy permitting not only overcoming them, but also their eradication. However, instead of constructing that strategy, the president has devoted himself to destroying everything that exists, much of which is not only functional, but also highly benign. Step by step, the destruction has been rising, to the extent that the moment will come that it will not be reversible. As the anecdote goes about the pilgrim who wanted to go to Rome, if the president wants to build a country according to his vision, he cannot continue on the road he is on.

The discourse of Camus went on: “My generation knows that it will not [change the world], but its task is perhaps even greater. It consists of preventing it from destroying itself.” We have witnessed two years of systemic destruction. Isn’t it time to start to build?

Opinion | Realities & ruptures

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Luis Rubio

King Canute of Denmark (990 A.D.) is famous for having positioned his throne on the beach surrounded by his entire entourage; seated near the waves, he commanded these to come to a halt, but ended up being drenched by them: Canute was ordering the waves to halt not because he thought they would but to prove to his obsequious courtiers that they would not. It was the ultimate demonstration of the limits of human power. This is how Mexicans should view the relationship with their neighbor to the North and, in general, with the rest of the world: the whole planet is changing and the elements that conferred certainty in past decades have eroded.

Beyond the pandemic, a glance at what is happening all over reveals patterns of behavior that would have been inconceivable just a few years ago. The most notable change, and more so for Mexico, is doubtlessly that which U.S. society has undergone in the form of President Trump. The country that was leading the world with an array of ideas and institutions relative to commerce, investment and international relations, the so-called “world order,” since the end of WWII, abdicated its leadership and is now the source of interminable conflicts and disturbances in the international arena.

Trump was not the product of chance. Like Brexit and other political happenings in the European ambit (Poland, Hungary, Italy, etc.), it reflects imbalances and the disillusionment of the citizens of their respective countries due to factors ranging from migration to the imbalances produced by globalization. For many years, the U.S. and China developed an outline of integration –which Niall Ferguson called “Chimerica”- which gave rise to strong malfunctions in industrial employment, wreaking havoc on the interior of U.S. society.

Many communities, typically in the Midwest, the heart of the industrial manufacturing belt since the XIX century, were dependent on a large company that dominated their work life –as occurred in industries like coal, steel and the automotive industry- were devastated when that employer decided to close down due to reasons as diverse as technological change, labor costs or environmental regulations. Persons who had devoted their lives to that company or activity suddenly found themselves without a job, with few skills or little capacity of adaptation to the “new” economy, the latter generally within the digital realm. While there is a proliferation of examples of successful adjustment (as in Rochester, New York, after the fall of Kodak), there is a vast number who were not successful, their populations ending up engulfed in alcohol and drugs. Trump did not invent that reality, he solely converted it into electoral might.

Many people await the day that Trump leaves the presidency and the world returns to normal. Unfortunately, although the stridency and the unpresidential manner of discourse and acting of a future administration could diminish, the structural factors that swept Trump into the presidency will continue to be there. Whether a government of the Right or the Left comes into power, the contentious matters that that nation is enduring today are not likely to abate, even if they acquire other shapes. The case of China makes this evident: both Republicans and Democrats have reached the conclusion that they are up against a hostile power and they are beginning to act, in unison, under that premise.

For Mexico, the U.S.-China conflict affords opportunities to secure our own production and supply chains and attract new lines of foreign investment, but it also constitutes a wake-up call with respect to the urgency of evaluating the key factors that sustain the current dynamism of our export sector and of taking action to attenuate those elements that are so disruptive in the bilateral relationship. In particular, Mexico must elaborate an integral strategy of rapprochement with the U.S. regions and communities liable to see Mexico as a nearby and reliable partner, all of this for the sake of protecting and guaranteeing our own interests in that nation. This would be even more important were Biden to win.

In contrast with China, Mexico experiences two wellsprings of conflict that are manageable, but which Mexico has not managed. On the one hand, two features are found that have become emblematic of the relationship and that Trump has exploited without batting an eye: migration and the trade surplus, which includes the movement of American production to Mexico. These are old issues, but Mexico has done practically nothing in the political ambit within the U.S. society -not in DC but in Peoria- to neutralize those sources of conflict. Regardless of whether Trump wins or loses come November, this is an open front that Mexico must act upon.

The other source of conflict is deeper and more complex because it concerns Mexico’s own lacks and insufficiencies, many of which manifest themselves in the border zone, but do not originate there, like drugs, insecurity, the lack of legal certainty. These issues are old and did not start with the López Obrador administration, but it is its responsibility to address them. That is where, as the President says, a good domestic policy is good foreign policy.

/mexicotoday.com/2020/09/22/opinion-the-new-context/

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Luis Rubio

In the “envelope theory” –an old joke of Mexican politics- the outgoing president leaves three envelopes to his successor. When things get stuck, the president, pressed, remembers the envelopes and opens the first one. “Blame me” says the paper. President López Obrador opened the first envelope some time prior to his inauguration and has been squeezing out of it all the juice possible, now empowered by the revelations of the ex-head of Pemex, Lozoya, albeit now diminished by evidence of the president’s brother’s corruption. There is no doubt that he will continue pushing the issue to the hilt without, regrettably, attacking   the cause of the problem: the impunity that lies at the heart of the political system. Sooner or later this will cease to be effective.

The second envelope -“reorganize your Cabinet”- will have a lesser impact. The problem for a president who wears so many hats and for whom everything is decided without the help of his collaborators, in addition to which, with minimal exceptions, that he confers zero space and responsibility on the members of his Cabinet, is that no one would even notice that he has already made changes in the team. The second envelope ends up null and void due to its being inadmissible. Soon he will come upon the third envelope, the one recommending the preparation of three new envelopes.

The envelopes are relevant for a government that entertains no greater aspiration than that of keeping the ship afloat, a characteristic common to many governments throughout the world. Improve a program here, correct the errors of a policy there, and see to the problems of the community of such and such a region are all valid objectives and, doubtlessly, those most workaday in public life.

But once in a while a government with enormous ambitions comes on the scene that purports to carry out a transformation. Some of those governments come garbed in grand ideas, initiatives and projects; others are urged on by nothing more than the strength of their will power and the expectation that that the mere force of their desire will lead to the achievement of the coveted transformation. When reality exceeds expectations and the absence of a plan begins to be evident, the envelopes become indispensable. What happens, however, when there are no more envelopes to open and the government has not even concluded its first years in office, long before the midterm elections?

The mediatic din with regard to the past will no doubt be deafening and could be infinite if the president goes ahead with a criminal persecution of some former president. Nonetheless, in addition to the dubious legality of such an enterprise, one should ask oneself whether it would be sufficient to cover the massive hole created by the unemployment and the recession that are already there but that are not yet perceived in the entirety of their depth and social implications.

The noise problem is that it is only lasting and truly a transformer when it has something more than utilitarian objectives behind it. In politics, of course, being utilitarian is always pertinent and, as the matter of the envelopes suggests, diverting the attention is a natural and logical part of the art of governing. The question is, noise for what? If the noise serves to appease spirits while other programs now underway advance but have not yet borne fruit, the circus is not only logical, but also highly valuable. Nevertheless, if the aim is pure and simply to buy time, trusting that things will return, by themselves, to their level, the risk is exacerbated, in that it is improbable that things would improve within a reasonable span of time, given the profundity of the recession and the absence of private investment susceptible to curtailing it. The issue is further complicated if what is behind the noise is not even a utilitarian proposal, but rather an objective of revenge, the product more of personal hatreds than of affairs of State.

The great advantage that the President enjoys resides in that an important part of the electorate continues to be angry with the status quo and is convinced that besieging the past is necessary. In a country where corruption has reigned to such a great degree as part of the exercise of power, visible in all of its splendor in the previous government, the media circus entertains prodigious validity because it responds to the visceral resentment prevailing beyond any political alternative, the latter inexistent to date. Although the government’s performance is mediocre in the best of cases, a wide swath of the electorate continues to be emboldened more by anger than by the hope or expectancy of something better. This is not a lesser advantage and constitutes a source of fodder that can be much more candescent and effective than might appear.

But anger does not solve quintessential problems, starting with eating and surviving. Notwithstanding that there could be a media “coup” in the form of major judicial persecutions, if they do not address the mainsprings of corruption, the citizenry will in the last analysis see that everything is a circus, but without sustenance, on the horizon. Decades of mediatic spectacles (large or small, regardless) have decanted a culture of cynicism that transcends any individual leadership, however powerful.

In the absence of another envelope, the government will soon confront the products of a project that does not respond to the circumstances and needs of the nation, but too soon before finishing it. The opportunity to transform, a real transformation, is still there.

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Luis Rubio

According to Marx, “Society does not consist of individuals, but expresses the sum of the interrelations of the relations with which these individuals stand.” Mexican society has been thwarted in its opportunity to express itself as a society because the logic of the political system always entailed controlling it. That is beginning to change: the opinion surveys show that the society equally falls all over itself before a candidate decidedly at a given moment, changes its mind, rebuking the candidate, two years later.*

More importantly, there start to arise all sorts of organizations and initiatives that evidence a society willing to assume the leading role that the old political system consistently denied them.

The paradox of the present political moment lies in that, precisely when the government is devoting itself to recentralizing the power, society is organizing itself to limit the damage that this concentration could represent and, perhaps, to become the crucial factor marking the future course of the country. This vital function that permits the country to grow and bear fruit, that which de Tocqueville discovered in the American society of the XIX century, begins to be born in Mexico. The great question mark is how the interaction will ensue between a government that repels (and disqualifies) anything appearing to be independent, and a society preparing to head a transformative process but that, at the same time, has yet to part with that tradition of control not only social, but above with all of its values, ways of thinking and, especially, of acting.

A Minister of the Interior of the era of the old system once summed up for me the official philosophy on freedom of expression: “In Mexico one can think anything, one can say some things and one can write the least possible.” If this is the way it was for the opinion pages, the latter relatively little read, what can one expect of the organization of a society as a springboard to action? The limits to free expression were real and they created a reticence, if not a fear (well earned), for society to organize itself in independently.

The challenge is not a paltry one. However much recent presidents bitterly protest the criticism observed by part of the national press, the phenomenon is one of only the last decades. In contrast with the freedom of expression that unfailingly existed in many South-American societies, even in the midst of dictatorships and authoritarian governments, in Mexico the old system constructed an unreserved form of subjugating minds that had the effect of devising official truths, a discourse of the acceptable (and the unacceptable), reprehensible ideas and a very peculiar notion of good and evil. The media -electronic and print- were instruments of power and served to advance the government’s purposes in exchange, of course, for direct benefits, usually cash, contracts or permits: those were negotiations with and for power. Those practices, still in our days, distort the exercise of freedom and the organization of society, as well as the media companies themselves, which are never far from the business of extortion.

The old system began to weaken in terms of its legitimacy and capacity of control at the end of the sixties, but it has taken two or three generations to rid it of all of that historical muck and mire, making it possible for the Mexican society to awaken, but now without the ideological fetters of yesteryear. Once this process takes shape, it will be unstoppable and, simultaneously, diverse and disperse, as is geography and the society itself: without rules, with a capricious and manipulatable Rule of Law and in the presence of endless conflicting interests.

There is an excess of examples and they are of the most diverse order: women who due to their need to find their desaparecidos, missing loved ones, in the end forged organizations dedicated to the search for anonymous graves; workers in the countryside marshalled together to defend their lands from criminals who raze their forests and appropriate their patrimony; entrepreneurs who come together to address problems that the government ignores, such as the brutal demand shock produced by the pandemic; political parties that begin to listen to the citizenry, instead of attempting to impose themselves, in order to regain their trust; analytical organizations that propose solutions to domestic problems; religious entities that defend human rights; groups within the governmental  party that assemble to advance their agendas, separately from the president.

The point is very simple: moments of crisis, recession, polarization and conflict are natural breeding grounds for the rise of social initiatives and organizations. Each is distinct: some are Right-, others Left-leaning; some propose solutions, others demand answers; some are deeply reactionary –of any color- often inducing to illegal acts. Taken together, the ensemble illustrates a society that is waking up and that is decided upon impeding its future from remaining in the hands of bureaucrats and politicians with agendas having nothing to do with the society’s interest, whether particular or collective.

Complex times are coming during which the interest in winning elections at any price will be in opposition to the needs and demands of a society increasingly more disposed to sticking its neck out. The winner will be the one that prioritizes the future above their immediate interest.

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*GEA-ISA Survey, July 2020.

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Luis Rubio

The democratization that the country has undergone over the last decades brought with it unanticipated consequences to deal with because the alternative is absolutely unacceptable. Whosoever wins an election feels free to advance their agenda not only disavowing the opposition, but, as occurs today, branding it as the enemy. Instead of a democracy, Mexicans have built, or reproduced for the XXI century, the famous phrase of Cosío Villegas: a six-year monarchy. Rather than employing politics to build a common future, a requisite interdependence, all critical and dissident thought are excluded. Those are the ways of a dictatorship and, when that happens, the political belonging or the person in charge is no longer important: what matters is the reality.

Many of the excesses of the present government, above all its manner of destroying institutions and obligating their legislative contingents to follow instructions, as if they were mere hired hands, are doubtlessly a visceral reaction to the excesses –in form or in substance- of former administrations. But the fact that a president can engage in excesses evidences the enormous fragility of our system of government, the pandemic accomplishing nothing other than magnifying this fragility.  Elaborating or modifying laws in a democracy is the elemental function of the government’s legislative branch that, in the separation of powers, constitutes an equal power and a counterweight. However, as Santiago Kovadloff says of Argentina, “we modify the Constitution much more than we comply with it.” In Mexico it is the president who presides over, legislates, executes and violates the Constitution, claiming that he is governing, when in reality he instructs and subjugates.

In nations in which the word is unique, an imposition, its reversion is similarly swift. What the president is doing with the economic reforms and with the institutions, trust funds, and organisms arising from prior executive and legislative actions cannot be explained as anything more than a revengeful and belated spirit deriving from the negation of time and from the change in circumstances.

Without doubt, what has made it possible to dismantle the administrative, political and regulatory structures lies in the trifling legitimacy that they enjoyed; but on acting in the same way –in fact, much more arbitrarily because here not even the forms are looked after- the President is sowing the seeds of the next counterattack. In place of building and governing, the population, which he treats as subjects, will end up seeing and thinking of the present government as it came to pass with all of the bygone ones. No one, not even AMLO, can challenge the law of gravity.

One could ask how is it possible for the President to possess such great power as to carry out his centralization program without any counterforce. The response is very simple: Mexico remains a pre democratic nation in which the members of his party in the legislative branch are disposed to yield to the President, and he continues to make them function in that fashion, shamelessly. Instead of representing the entire population, they respond to their boss, in typical pre democratic style.

The key question is what will these same legislators and judges do when the errors and privations catch up with President and they demand answers to the daily problems, those the pandemic accumulates at a speed superior to the growth of the number of deaths. If there is one constant that Mexican politics possesses it is that the king is king while he is there, but the moment that changes all hell breaks loose. There is not a sole president in this era who has not gone through that ringer, although some have gotten away better than others. Stirring up that vindictive fervor only increases the chances of it.

The other constant is the infinite incapacity to recognize what was previously achieved and to build on it. The past was always bad and has to be modified because the new owners are always more intelligent and competent than those of before.  The arrogance is so great that it blinds everyone, beginning with the most ambitious: a country of more than one hundred twenty million inhabitants is bossed around as if it were a small village in the middle of Tabasco. The problem is that, despite the mistakes and corruption, Mexico is one of the principal nations of the world and the citizenry, while belittled, has the right, and aspirations, to improve and go forward. In the long run, it always gets it what it wants. Information will continue to pour out even if the president closes all of the media.

However, the panorama ahead is not promising. Denying the number of deaths, the depth of the recession or the number of unemployed (the real number, not only those recorded by the Social Security Institute) does nothing other than contribute to the deepening and lengthening of two simultaneous crises: the health crisis and the economic one. The government ignores the citizenry, but the latter cannot ignore its reality, that which is hit directly in its income and in its possibilities of surviving.

It is urgent to review the content of Mexican democracy in order to re-engineer the form of governing. The absence of a process of reform of the political system is what has caused the subordination of the legislative branch, the dysfunctionality of the so-called federal pact and the excessive attributions -real and nominal- of this presidency. The alternative is not of an attractive color.

Opinion | Costs and Consequences

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a quick-translation of this article can be found at www.luisrubio.mx

In solidarity with Nexos
Luis Rubio

“The reports of my death are greatly exaggerated,” stated Mark Twain. The same can be said about capitalism. Since 2008 innumerable politicians, scholars and opinion writers have assured us that capitalism was at death door; twelve years later, the pandemic has unleashed a new wave of protests and Cassandra-like predicaments. But capitalism continues and will continue because, says Francesco Boldizzoni,* it responds to human nature.

The “Black Lives Matter” Internet page, the inspirer of the protests, states that its objective is “the dismantling of imperialism, capitalism, White supremacy, patriarchy and State institutions.” The agitators who have appeared in Mexico, in addition to employing terms not typical of the country (suggesting imported “technology”), do not have an Internet page, but without doubt share the same objectives. Instead of generating conditions for the prosperity of their hordes of followers, many Morena-party groups speak openly of creating chaos in order advance toward the paradise of Hugo Chávez.

The paradox is that liberalism, which historically has been an inexorable complement of capitalism, is flexible and adaptable, while the protesters are dogmatic and in good measure arrogant. Some will tell me that I cannot judge the movement, but their destructive nature speaks for itself. The agitators and those who follow blindly in their footsteps, hardly represent the population.

It is evident that the economic situation, the unemployment and the months of semi-quarantine have exacerbated spirits, but from there one is unable to deduce that the population wants to destroy what exists, however much the status quo requires and deserves fundamental changes. Whosoever burns or wrecks a business is certainly not thinking about the unemployed or the harrowing recession. It is pure and unadulterated vandalism with ulterior motives.

Two recently published books cover the persistence of capitalism, but with very distinct focuses. Boldizzoni begins with a pithy phrase: “These days the world seems to end with staggering regularity.” The great recession, Brexit, Trump, the climate apocalypse, the coronavirus and whatever accumulates this week, are all intimations of the inevitable and irreversible collapse of capitalism. But the masses never appear to learn the lesson.

The Boldizzoni book relates the history of capitalism in great detail: an especially valuable journey for the manner in which the author classifies the diverse critical currents. For Rosa Luxemburg, what is relevant are the implosion theories, in which capitalism collapses under the weight of its contradictions. Others, such as John Stuart Mill and Keynes, propose the depletion of capitalism that leads to its death after its having engendered a foundation for prosperity. The voyage concludes with Schumpeter, who worries about the contrary: that the success of capitalism in devising wealth and prosperity prompts the abandonment of the work ethic that made it successful. Most valuable in the text is that it situates capitalism within its just dimension: it is “both an age-old human activity —individuals producing and trading— and a more recent socio-economic system based on clearly defined property rights and wage labour.” Although the author is critical of capitalism and speaks in catastrophic terms, his argument is, in essence, that capitalism is inherent to humanity and that this explains its persistence throughout the centuries.

Thomas Philippon** follows a very distinct line. His text compares the way the economies of Europe and the United States have evolved over the last decades, evaluating the capacity of flexibility and adaptation of each of these. He starts by observing the ability to innovate, finding that Americans are superior in developing novel devices, which the author calls “toys.” However, while during the eighties the Americans precipitated two moments of high innovation thanks to the unfettered competition apropos of the deregulation of aviation and the breaking of the telephone monopoly, Philippon’s appreciation is that European regulators learned these lessons better than the Americans themselves, developing greater regulatory effectiveness on intervening in the market, producing much greater competition in their economies.

The lack of competition in the U.S. economy is not a new criticism, but the author’s conclusion is that economic success depends on the  aptitude for generating wealth and that is measured in terms of market access, which the author consider to be superior in Europe.

The lesson for Mexico is evident: Mexico has, literally, millions of entrepreneurs who struggle from sunrise to sunset to build their future, but they never end up growing and consolidating because becoming formalized is so onerous that they never make it. It’s easy to get lost in big businesses, but what is transcendent here is the enormous number of potential entrepreneurs, limited by regulatory and fiscal requirements that are frequently insurmountable. These books show how important it is to have a competent government that creates conditions for prosperity. Unfortunately, to date, this in Mexico is not part of the equation.

*Foretelling the End of Capitalism: Intellectual Misadventures Since Marx; **The Great Reversal

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Luis Rubio

Which came first, the chicken or the egg? The eternal riddle of both science and daily life is never resolved, but what is transcendent, says Matt Ridley in his new book on innovation, is how one thinks in this regard. The theory of evolution exemplifies the point in razor-edged fashion:  evolution does not tell us anything about the existence of a superior being, but attests to that if this in fact does exist, it does not entail, or abhors, central planning. Evolution does not have a predictable pattern but studying it allows one to entertain a distinct perspective about things and, as Alan Kay affirms, possesses a higher-ranking value: “a change in perspective is worth 80 IQ points.” If Mexico wants to break away from the pandemic quickly, the recipe dwells on creating conditions for innovation to flourish. In How Innovation Works: And Why It Flourishes in Freedom, Ridley insists on looking further than the evident explanations and proposes that on adopting a creative manner of solving problems one becomes less dogmatic, especially on recognizing that there can be more than one solution to a given problem and that making mistakes is part of the process and is not a failure. “Innovation is the child of freedom and the parent of prosperity.” This is the heart of Ridley’s argument: progress cannot be planned; contrariwise, innovation is always disruptive. “Innovation is obvious in retrospect, but impossible to predict.” This is due to that the process that produces innovation is not linear and always involves wrong answers and right answers that, in conjunction, advance knowledge. Underestimating the creativity and abilities of persons acting of their own free will and without coercion is the most frequent error of bureaucracies that claim to advance science, knowledge, and technology by means of design and central planning. Ridley illustrates this point comparing the way that France, Germany and Great Britain moved forward in the XVII and XVIII centuries: while the continental governments engendered vast bureaucracies devoted to the furtherance of science, the English government was very slow to support its development, privileging the market as the decisive factor. This is how the Industrial Revolution ended up being English. The key here is that no one can anticipate, plan or predestine the course of the advance of knowledge. “It pays not to underestimate self-deception and noble-cause corruption: the tendency to believe that a good cause justifies any means.” This is as valid for science as it is for energy and economic growth. Ridley demonstrates that progress does not begin in the laboratory to then move toward the commercial world, but often the inverse occurs: it is changes that take place in factories, workshops and offices that are then rationalized and codified by academicians, these in turn making sense of their own studies. Darwin, says Ridley, proactively went in search of the advice of pigeon and horse breeders because they would understand, in a practical manner, what Darwin would later call “natural selection.” Ridley comes down somewhat hard on scientists, but his point of view engages a certain logic: entrepreneurs are nearly always conceived of as merely avaricious beings with no interest beyond money, when in truth the enterprise is the most successful problem-solving mechanism ever created. What is relevant is the system that permits one to innovate, this much more efficient in companies than in academia. “Innovation is not an individual phenomenon, but a collective, incremental and messy network phenomenon.” The “messy” factor appears to be crucial in the innovation process.  The notion of a “messy network” that produces a new order is fascinating to me in that it cannot be anticipated or planned: it is disordered in the sense that it depends on trial and error, on false beginnings that take shape based on experimentation. One learns by doing, with the creativity that permits promoting human inspiration to procure benefits for the collectivity. The book’s subtitle sums up its entire argument: progress is made in freedom and advances by putting alternatives to the test and frequently misfiring. Many things are understood in retrospect and it is rare for one factor to be definitory in the result. There are no “eureka” moments that resolve everything. Progress requires an environment of freedom and conditions that favor creativity: a mixture of public policies and a legal framework that promotes efficient markets and enables work. Ridley’s proposal is not a paradise for the bureaucracy. Politicians and bureaucrats always believe that their intentions are results that on only wishing for an integral transformation one will be achieved. Ridley convincingly establishes that progress cannot be planned, but instead comes about when propitious conditions exist for it, the most important being the freedom to think and act. And this has never been truer than today, in the midst of this terrible recession. CONACYT, SEP and the Mexican government would reap great benefits on understanding how is it that the world advances because the future of the country largely depends on what they do and, above all, of what they impede.

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https://mexicotoday.com/2020/08/19/opinion-to-progress/