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.

www.mexicoevalua.org
@lrubiof

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

Luis Rubio

There is nothing older than resentment, above all of the poor toward the rich. Nor is it new to the politicians’ resource of exploiting and provoking grievances, real or imagined. Isocrates, one of the great Greek orators of the IV century A.C., accused hostility, but he recognized it as a typical emotion of democracy. What has changed, says Jeremy Engels,* is that while in a direct democracy citizens express themselves openly at the polis, today it is politicians who incite resentment as a governing  instrument. Such a strategy, writes Engels, has limits and can easily revert.

The Greeks saw democracy as a fraternity of citizens dedicated to curbing tyranny. Their results, however, did not impress the Federalists, those thinkers who gave life to the American political system: for them, it was fundamental to avoid the “tyranny of the majority” because a democracy should similarly protect the minorities. The Federalists’ concern was very specific: once the fury is unleashed, nothing can contain a bloodthirsty mob.

The underlying problem is, and always has been, that there are natural differences among citizens: wealth, abilities, origins, preferences, education. Social differences comprise an inexorable part of the history of humanity and democracy is one way of making decisions that permits all citizens to participate equitably, independently of those differences. It is the public policies that the democratically elected government adopts that should attenuate the differences and equalize the opportunities.

Resentment is a knee-jerk reaction to the contrast between the promise of equality inherent in democracy in the face of the flagrant inequities in the results of the political process or when disparities between poverty and wealth are major. The degree of disparity is providential material for politicians and special interests devoted to profiting from social differences and the privileges enjoyed by some as a means of advancing their causes: gaining popular backing and, more commonly, manipulating the population. The resentment that is inherent in human society ends up being an instrument of power to control the population: the quintessential strategy of demagogues like Perón, Chávez or Trump, the same as that of corporativism, of sad memory  in a good part of the Mexican XX century, and of the fascist system conceived of by Mussolini.

Confronting and agitating the population is the tactic that President López Obrador has employed to build up his base and solidify his project. The key question is whether this is a means to advance a constructive transformation that reduces inequity and that raises aloft the development to which the entire population can aspire, which is, at least in the rhetoric, what was proposed by the users of the same method of the old PRI; or whether it is a first step toward the destruction of the fragile social stability characterizing the country since the seventies. In the first case we would be speaking of a process of conformation of a regime of control to substitute for what characterized Mexico after the Revolution; in the second case, the beginning of a process of destruction of the frail Mexican democracy that has come to be built with penury, setbacks and reluctance in recent decades. In both cases, resentment as an instrument of power, not of the construction of a better future.

What there is not the least doubt about is that the President sees confrontation and animosity as instruments of governing. In this he is not differentiated to a great extent from other experiments throughout the world or in the South of the continent, all of which ended in failure, some due to the bankruptcy of their economies, others because they brought about violent responses. Chávez opted to invest in insurance against a tempestuous way out, on virtually transferring to Cuba the control of his country.** Whatever the method, none of those examples benefitted the citizenry or empowered their prosperity, but all impoverished the citizens and blemished their followers.

The problem is, once the anger is unleashed, returning to a world of concordance becomes nearly impossible. Venezuela, Argentina and Chile stand as examples where rancor has never perished.

The sole clear element is that the popularity of the President continues to be relatively high, not the result of his inexistent successes in economic matters, corruption or in social concord, but instead more probably the result of the hate that he has laid bare and that he might not be able to stifle. The evolution of perceptions among the citizenry of a leader who provokes but who does not get results is not obvious. Will another appear to capitalize on that very resentment?

When Lenin arrived at Petrograd after being expelled from Zurich, the Revolution had already begun but he had something unique in hand: a plan, which allowed him to take control and build a regime in his image and likeness. The Mexican reality is in such an agitated state that whoever arrives with a plan could become a new leader. The risk is that were the plan like that of Lenin, Chávez or Bolsonaro, Mexico would end collapsing, like so many other experiments in history.

*The Politics of Resentment;
**Maldonado, Diego G., La invasión consentida 

www.cidac.org
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https://mexicotoday.com/2020/08/11/opinion-resentment/

Luis Rubio

Continuity is normal when a government changes, with natural adjustments for style and personality. The president changes, but the country continues along its course: the new government imprints its forms, preferences, and priorities, but in general perpetuates the essence of what the government is and its relationship with the society. On occasion, for endogenous reasons –such as the advent of a  transformative government- or on exogenous grounds –like the appearance of unpredictable factors such as a pandemic and its social and economic sequelae- the circumstances press for a break with the past or render one possible. Now and again, the changes improve the future, at others they amount to a shot in the foot.

The main gamble of President López Obrador is for his base, now his clientele, to be preserved intact despite economic infirmities and unemployment, and for the U.S. economy to be sufficiently strong to generate demand for domestic exports.  As the principal engine of Mexico’s economy, exports are key for any attempt at economic recovery, as Mexicans learned so well in 2009, when the U.S. recession nearly caused a depression in Mexico.

Another issue is for the presidential project to end up untouched, despite the changes taking place in both the internal as well as the external milieu. The only sure thing is that everything the president does -his visits around the country and the entire political operation- are oriented toward winning the midterm election in 2021 at any price.

In this perspective, there is no tediousness in the query of whether this government is driven by the search of a profound change (the demagogues of the so-called Fourth Transformation love to speak of an inexistent “change of regime”) or of continuity with modifications in the style of the presidential house. Beyond eliminating counterweights that have proven to be paper tigers, the government has accomplished nothing other than strive to recreate the old Mexican Presidency, but those efforts have come to entail unanticipated consequences. Perhaps the President has not realized that the greater the control, the greater the deterioration: in an open world, restrictions, cancellations, and impositions have an incremental cost.

The key question is whether everything the country and the world have undergone this year will allow it to return to the previous normality, as if nothing had happened.  Serious countries that led the public health process without competing agendas –such as Germany or Korea, to cite two successful cases- have achieved a return to some degree of normality and, along the way, their governments have earned the applause of the citizenry because the latter recognized in the government an ally that did nothing more than dedicate itself to combating the common enemy. In Mexico, the government encountered a multiplicity of adversaries, took the fight against the virus in jest and won the disapproval and, worse, procured the disappointment of a good part of the collective citizens, as surveys have conveyed. It may be that in terms of greatest importance for his sole objective, the 2021 elections, the President has done nothing, not even recognize that unemployment and recession entail consequences for persons and their families, especially the most vulnerable, many of whom voted for him. The ballot boxes will be the ultimate test of those perceptions.

Two circumstances make one doubt the viability of the governmental plan of action. The first of these is whether the blind obstinacy in “priority” projects (such as the refinery and the Tren Maya) is the best way of governing. The famous Prussian General von Moltke said that not even the best of plans survive the first contact with reality, and no one should have the least doubt that the reality changed radically over the last few months due to the recession, which had been looming since last year, as well as unemployment. The President has not been willing to alter his project even an iota, which obligates asking the question of whether lack of attention to the most affected population will exert political and/or electoral effects. It is inconceivable for it not to.

The second characteristic of the governmental approach is that it is, at its core, a fundamentally commercial transaction: while the President devotes himself to activating and nourishing his networks through his tours around the country, the lifeblood of his electoral strategy lies in the transfers of monies to older adults, to “young people building the future” and to other clienteles. Those individuals and families doubtlessly are grateful for the contribution, but that does not mean all of them are believers as a result: except for those who in effect entertain a quasi-religious bond with the President (there are many), the rest maintain a basically business relationship, which depend on the transfers continuing. Vote buying is an old tool in Mexican politics and the population engages in it as it is: a transaction. Will the relationship survive when public finances put a squeeze on, which will inexorably happen in the upcoming months?

Nothing is written for the 2021 elections, but it is clear that Mexico is already in full electoral season, and everything that the government and the opposition do is directed toward defining or redefining the correlation of forces that emerged in 2018. The problem for the government is that it does not possess a strategy for the development of the country and that is, at the end of the day, what makes a difference for the citizenry.

https://mexicotoday.com/2020/08/04/opinion-shot-in-the-foot/

www.mexicoevalua.org
@lrubiof