Luis Rubio

The only facet of life that is implacable is time gone by and, in political matters, Mexico is nearing the start of presidential succession. Positions are beginning to be honed, candidacies are cropping up everywhere and, little by little, the last stage of the sexennial cycle is emerging. As Miguel de Cervantes would write, “Neither good nor evil can last forever… so thou must not distress thyself with the misfortunes which happen…” The panorama is becoming clearer, evidencing the lacks. Up next is to understand why, after so many decades of reforms and good wishes, the country continues to be held back by ups and downs, unable to take that great leap forward that characterizes so many successful societies in the world.

In his Nobel Prize acceptance speech, Albert Camus foresaw what has occurred in our country during these decades: “Each generation doubtless feels called upon to reform the world. My generation knows that it will not reform it… Heir to a corrupt history, in which are mingled fallen revolutions… and worn-out ideologies, where mediocre powers can destroy all yet no longer know how to convince…”

All governments come to their inauguration with the certainty that they will know how to change the world, that all of their predecessors were torpid and inept. No one like Trump in that regard, but the phenomenon is universal: no promise is ever too great for a candidate to make: they all believe that they will leave an indelible footprint, the bedrock of the future. That is how the government of President Peña commenced, who, rolling out all the fanfare, launched a series of initiatives and strategies, both of reform as well as of how to govern, which ended up producing a mixed balance: legislative advances (almost) without precedent, but an everyday reality ensnared in the throes of growing deterioration. Part of that was the product of the contradictions inherent in this government itself, but much of it was not distinct from what has transpired in the country during the last half century.

The contradiction at the core is not peculiar to the current government: it is the same stone over which all of the governments since the eighties have tripped. In recent days we have been provided with a window of opportunity that permitted us to observe one of the many examples illustrating the incapacity to extricate ourselves from the old political system. The case of the pipeline thieves, the so called huachicoleros. The existence of these gas and petroleum-pilfering groups is suggestive of the fundamental problem; beyond the enormous cost both economic as well as of illegitimacy for the system of government that represents the impunity in this and in all the rest of national affairs, the reality is that there is no incentive to limit, impede or punish those who engage in this crime for a very simple reason: there are huachicoleros who are apprehended up to two or three times in the same day and who, after paying a symbolic fine, are set free to continue their criminal activities. They do this because it is not considered a crime of consequence, not one involving jail time; consequently, even with the police that we have, the incentive to catch these criminals is negative because their crime entails no consequences. The relevant question is not why they steal the gasoline (that is obvious), but instead why it is not a serious crime that would serve, at least in principle, as a dissuasive factor. The evident response is that there are powerful political, union and criminal interests that benefit from the status quo and that wield the sufficient power, or the threatening capacity necessary, to preserve it.

The same is true in all ambits of national life: there is no reform -economic, political, labor or of civil or human rights- that does not affect the powers frozen in time, those that have embezzled for decades from the system and directly or indirectly pillaged the Public Treasury. The existence of these powerful interests has meant that the reforms, from the most modest to the most ambitious, never deliver all of their benefits, because that would imply altering the status quo from which they benefit; thus, the reforms neither advance nor confer feasible benefits, creating a vicious circle: the reaction -and the reactionaries- in this world discredit the reforms, vowing a return to the idyllic world of the past. And this is where the ongoing succession process crosses paths with daily life.

The recent French election established a new paragon. In contrast with the U.S. election last year, in which Trump embraced increasingly extreme stances every day and Hillary did nothing other than promise the same thing but a little less of it (e.g. TPP), the candidates in France did not waste any time: Le Pen proposed a return to the past while Macron presented an ambitious, proactive and bold agenda, the past vs. the future, nostalgia vs. hope. I ask myself whether there will be some candidate in Mexico who will be capable of advocating a distinct future, a promising opportunity for a society plunged deep in that sinking feeling. Break the vicious cycle.

We already know the past, which is precisely that which lies behind the interest of the power of the old political system and which, as the huachicoleros exemplify, were not perturbed even by the governments run by the PAN. Mexico needs a new political regime: would that the aspirants who fight with such zeal for the candidacies, also possess the vision and the courage to break with the old regime that eats away at everything.

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@lrubiof

Luis Rubio

Mexican reformers remind me of that much-publicized prediction of Michael “Sugar” Ray Richardson, the basketball player who made himself famous for once having told a sportswriter that his team, the New York Knicks, was “a sinking ship”. When the writer asked how far the ship might sink, Richardson replied, “The sky’s the limit.” Contradictions are inherent in our system of government, designed for everything to change so that, at the same time, everything would remain the same.

From the eighties, the country embarked upon a process of reform with a very clear public objective, but with a private agenda on the side. The public part was to raise productivity with a goal of, by that means, increasing investment, thus the generation of wealth and well-paid jobs. The project was technically impeccable because it revealed a flawless understanding of the nature of the problem, at least in economic terms.

At that time, the country found itself at a standstill because it retained an endogamic economy where public and private monopolies proliferated, in which the politicians’ enterprises drove the decisions on economic matters, where the labor unions determined what made progress and what stayed the same. The so-called “system” labored to reach a sole objective: preserve and increase the privileges of the political class, of the “Revolutionary Family” lineage that, due to its having won that epic battle, felt itself to be the owner of the country, its resources and its future.

Although it is evident that much has changed, what survives from that world is enlightening. Examples abound: we have many persons looking for work and demanding it at any cost and we have an infinity of companies requiring employees in order to make headway; it would appear to be a perfect match between demand and supply; however, it does not work for a simple reason: thanks to the Teachers’ Union (in all its variants), education in the country continues to devote itself to perpetuating poverty, controlling the population and impeding progress. The recent educative reform comprises a move forward but, to date, only in concept: the reality is the same as always. Another example: thanks to the business of some unions and politicians who had the monopoly on the distribution of PEMEX products (by truck), the nation now possesses many fewer gas pipelines than those required by an economy aspiring to rapid growth. One last example: I do not know whether any Mexican has thus far perceived that we have a small security, justice, corruption or impunity problem, but it seems evident that the latter is not obvious to those responsible for national affairs at all levels of government; those who have been in charge, and their candidates, see these issues as a mere distraction.

It is within this context that reforms such as those of energy, education and NAFTA itself would have to be evaluated, not to mention matters such as corruption and the judicial reform: the condition sine-qua-non for investment to grow is legal and patrimonial certainty, which is impossible to the degree that the old political system and the criteria that moved it –in legal and bureaucratic practice- endure. The challenge in matters of energy is particularly acute in this regard. Justice, security and economic growth go all hand in hand.

Mexico is recognized worldwide for reforms that, since three decades ago, began to be adopted. Be that as it may, compared with other countries that are also reformers, our progress has been less because of the private agenda that has accompanied the reforms: everything is all right as long as it does not threaten the interests and privileges of the beneficiaries of the political system of old. So deeply rooted is this criterion that even the two PANist administrations upheld it. The way that the federal government has conducted itself in the State of Mexico electoral campaign is suggestive: anything goes so as not to threaten the status quo.

“The end may justify the means”, wrote Trotsky, “as long as there is something that justifies the end.” The problem is that the end implicit in the reforms involves nothing changing; thus the reforms end up being weak and insufficient, at least in terms of their implementation. Of course, all reforms, in Mexico and in the rest of the world, de facto incorporate the realities of the power and, in this sense, we cannot compare reform processes such as those of Korea, Chile or China with those of Mexico, because in those nations there were hard governments that imposed their law.

Mexico’s case is peculiar in another sense too: it in fact undertook a political transition that did not change the political arena. There is a new electoral reality and freedoms but not a new political regime.  From this perspective, the implicit objective of the reforms –preserve the privileges- has been absolutely successful.

The question is, at what cost: the country has for decades entertained a meagre 2% annual growth on average; the population calls for better life levels but, thanks to the privileges, has not had access to the schooling that would allow the achievement of these; investment grows, but very much below potential; the insecurity destroys business concerns, families, expectations and, above all, the trust that is key for progress. All this, in exchange for what?

The dilemma is clear-cut: Mexico either takes the step forward or perseveres with the pretense of change but the reality of corruption and impunity. Worse: however little or much the reforms have advanced is in question due to the external and internal threat and without a population willing to defend what it does not feel is its own.

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Luis Rubio

In the film The American President, the President confronts a brutal fall in popularity and a strong contender who saturates the media. Confused, the President says that people have the right to listen to whom they want. Lewis Rothschild, his assistant, answers him: The people, “they don’t have a choice! [The contender] is the only one doing the talking! People want leadership, Mr. President, and in the absence of genuine leadership, they’ll listen to anyone who steps up to the microphone. They want leadership. They’re so thirsty for it they’ll crawl through the desert toward a mirage, and when they discover there’s no water they’ll drink the sand.” President Andrew Shepherd finally responds that  “People don’t drink the sand ‘cause they’re thirsty. They don’t drink the sand because they don’t know the difference…”

All presidents, in the world, in every country, assume the office to save their respective nation and, sooner or later, become bogged down by the reality, which obligates them to rework their objectives. Some respond with astuteness, like Bill Clinton; others act savagely as in Tiananmen Square in 1989. Some succeed in transforming themselves, others end up collapsing.

The government of President Peña arrived at the zenith of his project at the end of 2013; thenceforth began his fall. Despite the assertiveness of his initial performance, in reality he did not have a flight plan beyond the legislative approval of a series of reforms that were passed in record time. Once that threshold was traversed, the government left the implementation of those reforms to the individuals responsible for each of the respective areas to decide on them. Peña’s true plan was not the reforms, but rather the recreation of an imperial government, in the manner of the fifties and sixties of the past century. That is, the project was the government and nothing more.

The problem was two-pronged: on the one hand, it was impossible to create anew what no longer existed and that had disappeared because it was not functioning. On the other hand, on presenting himself as the sole mortal responsible for everything that happened in the country, the President ended up taking on all of the problems that arose: from Ayotzinapa to corrupt governors. His aloofness relayed him to the gallows and he did not know how to respond. Worse: in the face of his incapacity to understand the nature of the problem, rather than building a way out, he continued to dig himself deeper into the hole in which he found himself.

The form of his leading the government reminds me of an anecdote that a friend related to me: “Many years ago, in my college years, I attended an experimental theater presentation that, I believe, was called “Chaos on the Stage”. It was a parody of an orchestra director who could not define which work to interpret. Thus, all of the first interpreters [for example, the First Violin] tried to convince him of which score to play, that in which the individual’s instrument would appear to greatest advantage and, to prove it, there were small selections of the recommended pieces heard on playback. Because the director was unable to decide, the pressures of the first interpreters and of the music that they endorsed began to accelerate until the play concluded in utter stage and auditory chaos.” That is what the government seems like, with dissonant speeches, unconnected actions and, above all, a total absence of clarity of course.

What Mexicans require is certainty of the future, something for which many of the reforms can be highly relevant. However, the presidential discourse is totally alien to that citizen demand and, as the film passage evokes, the only person attempting to provide that certainty is the contender, who is doing so, and what’s more, with enormous skill.

The crucial question involves what the President can do to avoid an uncontainable crisis at the end of his term, just when the months of frank downturn of presidential power set in. First, the president has nothing to lose in that his popularity is so low that it can only go up. To date, he has exclusively accomplished one essential thing that will allow the avoidance of a crisis yet greater than what now seems inevitable: on correcting the fiscal aggregates, his government has dramatically reduced the risk of a new crisis.

In the political ambit, it would be much better for him to stop attempting to manipulate the electoral processes that are underway, in that everything will revert against him. Similarly, he should dedicate himself to all Mexicans and not only to his party brethren or pals: each governor whom he protects becomes an additional burden that he must shoulder; it would be better for each to face up to his own deeds (and crimes).

Finally, the country encounters a phenomenal challenge  in the relationship with the U.S., which changes continually and that has become eminently unpredictable. The population has been absolutely willing to join forces with the President in this process, but he has shown himself to be partisan and has not taken advantage of the largest source of strength that there is in the face of the U.S.: the innumerable daily contacts that exist between Mexicans and Americans for business, family relations, exports, imports and every species of exchange that the government does not control, thus rendering these connections more legitimate. If the President desires to emerge from the hole in which he finds himself he has to start to add and add more and more.

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@lrubiof

Luis Rubio

Beyond the aspirants to the Mexican presidency in 2018, perhaps the crucial factor that determines the way electors will act derives from their perceptions of the current reality.  According to Pankaj Mishra in his new book Age of Anger, those who have not achieved inserting themselves into modernity and take part of its promises –freedom, stability and prosperity- are always easy victims of demagogues, likewise Left and Right. Realities and perceptions are interlaced to the point that they often end up indistinguishable: wins the one who creates a propitious environment for his perspective and vision.

In all corners of the globe, the upset of traditional life could scarcely be greater. Telecommunications has engendered a universe of immediacy; governments, former proprietors of the truth through control of information, today comprise one more mere actor in the discussion of public affairs; job sources have been transformed mercilessly: partly due to competition, partly because of technological change. In this context, there no longer are permanent moorings of stability to which to cling as sources of certainty. The impact, worldwide, has been extraordinary.

This type of disturbance, says Mishra, is not new in history: anger and discontent are factors that are repeated throughout time when high-flying political or technological transitions take place. His argument reminds me of that brutal phrase that Tony Judt makes: “Few in the West are old enough to know just what it means to watch our world collapse.“ In the last years we have seen disturbances in the electorate of Poland, England and the U.S. In a few weeks we will see whether something similar happens in France. The response of anger and hatred, as well as self-justification of the violence, are not very different from the messianic and revolutionary movements of Europe in the XIX century or from the Russian anarchists of that era.

Some assert that the growing inequality is another explosive ingredient in this cocktail. Walter Scheidel has just published a massive book in this respect,* arguing that, all through history, only revolutions, epidemics, collapse of States  and the mammoth destruction of riches that leads to generalized impoverishment,  constitute factors of social equalization, perennially downward, that is, because they ravage the existing wealth. One of his most important contentions is that no country has diminished inequality through structural reforms because these are, at the end of the day, arrangements among those in possession of the power. Ian Morris, an old scholar of these questions, explains why inequality is not a relevant factor in this era: despite inequality, the average industrial worker lives more years, eats better and is richer, freer and better educated than nearly all of the human beings who preceded him.

That is, following Morris, to the degree that the perceptions and expectations of the population are positive –that their life level will improve- the voters do not entertain any initiative to modify the status quo in a radical manner. The day before the U.S. and Brexit elections, there were many possible scenarios at play: in both cases, the result could have gone either way, because both were very close. In this regard, while the political fact of who wins and who loses changes the panorama, the explanations about why it occurred tend to be excessive: more justificatory than analytical.

My point here is that there are factors that influence the spirit of the voter and that all politicians (with the exception of the President of Mexico at this moment…) ply exploitation in an attempt to sway the will of the electorate in a given direction, creating an environment of certainty. No one has been more skillful and virtuoso than AMLO in these leagues.

The changes undergone by Mexico in recently times have also been enormous. Part of the country has been transformed in impacting fashion and part has remained shackled to the past.  Those in the first group surely have a positive perspective of the future, while those persisting in ancestral forms of life and production probably have not modified their manner of perceiving the world in many decades. The most volatile electorate is the third group:   that of those who have seen the world change without getting a grip and reliable sources of certainty. Part of that derives from the uncontainable process of change, part from the absence of responses and solutions to daily problems –from poor infrastructure, passing through corruption- but taken together, this generates conditions that are naturally well-disposed to ire, anger and malaise. The lack of certainty with respect to NAFTA clearly does not help.

None of these elements is novel in Mexican politics. What is new is the absence of presidential leadership. Without party distinction, all of the recent presidents attempted to channel to the process of change to make sense to and provide direction for the population. Today the only one attempting that leadership is the main opposition candidate. Thus, it is not difficult to account for his position in the polls.

*The Great Leveler: Violence and the History of Inequality from the Stone Age to the Twenty-First Century

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@lrubiof

Luis Rubio

One of the most foreseeable reactions and consequences of Trump’s discourse throughout the last year and a half would have been a rapid growth of anti-American sentiments in Mexico. And, without doubt, that has occurred, but with nuances that are significant. To being with, however much the new American President has referred to all Mexicans, the principal reaction of those living in the U.S. illegally is simple and natural:  fear, if not terror. Those in the crosshairs have no time to hate.

A few days ago, I heard a California legislator describe the new reality:  empty schools and children keeping silence at home while their parents go to work, typically leaving very early and returning late, not because their work demands it, but rather because obscurity offers them a greater hope of being able to avoid the manhunts. The Trump discourse and the emboldened police charged with migratory affairs have changed the world for the Mexican communities, creating a new reality in their daily life.

In Mexico the intellectual and political protest is active, emotive and decided, but very distinct from that of the man in the street. Particularly revealing is the fact that Anti-American or anti-Trump sentiments are concentrated in the world of discussion but not so much in real life. Those with families in the U.S. are afraid as much as for the risks that their relatives run at present as for the uncertainty regarding their sustenance. The remittances can be understood as an item in the balance of payments or as an income that sustains millions of families in the country. Those families depend on the earnings of their relatives, who left in order to provide a better life for those that they left behind.  For them the matter is one of basic subsistence, not of politics or emotions.

It is in this sense that the manner in which distinct nuclei of Mexicans here and there have reacted is paradoxical. For those for whom the relationship with the U.S. is an everyday affair, the basis of their bread and butter –the same for those who emigrate as for those who depend on exports- the reaction is fear or worry, not hate: visceral anti-Americanism has not arisen there. Perhaps those who have emigrated do not have a thorough understanding of the history or of the deep-rooted causes of the circumstances that obliged them to leave, but they do know well that something here in Mexico does not work. The same is true for those working in the industry linked with NAFTA and exports; everyone knows that Trump is a problem, but the regime from which they fled is much worse than the one under which they live: in the U.S., there are rules and here everything is uncertain, from the safety of their lives to the continuity of public policy. It is not black and white.

The average Mexican is infinitely wiser than the politicians (or the intellectuals), who believe that they represent them. For them it is about life or death; for the others it is a matter of positioning, ultimately ethereal. Minimizing the causes of leaving or, in the case of NAFTA, of the sources of certainty that the treaty generates, is to lose sight of the fact that reality at the ground level is clairvoyant. People emigrate because there are no opportunities here and those who have jobs in NAFTA-associated companies (or ones related with its “philosophy”) put up with it because they know that the alternative is infinitely worse. These are inexorable manifestations of the quality of the Mexican government, the government of today and that of the last century. Few dare to ask: Why don’t things work here?

It is paradoxical that even the most affected individuals do not blame Trump or the country that gave them shelter, because they well know that the alternative is much worse: more of the same. Trump, a personage who lives from exploiting his brand (in hotels, clothes, condos and every sort of product of mass consumption), has undermined the trademark of his country in a manner that would have been inconceivable only a few months ago. Many hated George W. Bush for his warmongering, but they drew a line between the person and his country. Today this is impossible. Trump won thanks to a divisive discourse and one founded on hate. Despite that, those who work for a living, independently of their legal status in the U.S., pray, not hate.  They know (or trust) that, in contrast with the Mexican Government, this is something transitory; that which in Mexico has been going on for two hundred years and will last for a good while longer.

In one of his famous paintings, Roy Lichtenstein sketches Donald Duck fishing and telling Mickey Mouse “Look, Mickey, I’ve just hooked a BIG one”, when he in truth had hooked himself…. Something like that has happened in Mexico: it has hooked itself and this could not have come about at a worse possible time.

The outgoing government appears to have decamped, leaving the field open for a potential successor who represents its worst nightmare.  Instead of taking advantage of this time to erect the scaffolding of a viable nation and one sure of itself, it has opted for passivity and acquiescence. That may not be its objective –as its obsessions prove-, but that is what it is in fact doing.  In comparison with Mexicans linked to the U.S. in diverse ways and who are attempting to find a way out of the predicament, the government has entrenched itself. A gallant way to govern.

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Luis Rubio

The energy reform continues to advance despite the low oil prices but its potential impact os far greater than it appears at first sight. Even if nothing else were to happen, the mere liberalization of trade in energy matters and petroleum derivatives uncorks huge opportunities for industry, in addition to opening incommensurate competition for Pemex and the CFE. It is not bay chance that this has become one of the most contentious issues in Mexican politics today.

The growth in investment, whether in association with Pemex or in independent fashion, will demand the growth of ports, highways, oil pipelines and other infrastructure that, in itself, will generate opportunities in the form of expenditure, investment and employment. Implementing the reform entails exceptional challenges: on the one hand, the reform needs to be implementing in full, including the relevant regulations that will provide the rules for the daily workings of the industry. On the other hand, there is the fact itself that the energy market involves actors with vast international experience and, at this moment, with a sweeping diversity of investment opportunities and possibilities. That is, it’s a buyers’ market where the one with alternatives is the potential investor. The key to attracting that technology and that investment dwells on the quality of the regulation.

In one of his writings, Sergio López-Ayllón cited the daunting dimensions of the legal process requiring implementation and mentioned the following four obstacles to surmount: a) organizing the administration in such a way that it would be capable of processing and resolving what at present are contradictory mandates, limited capacities and restrictions for responding in an environment that demands flexibility and agility; b) the urgency of achieving an effective regulatory framework out of the current structure which is complex, imposes high costs and that, “far from providing certainty and judicial security, the legal environment, is one of uncertainty and conflict”; c) the federal arrangement in force does not correspond to a deliberate design in which there are defined responsibilities, capacities and resources. “The result is a knot where many of the decisions pile up and clash with the lack of effective coordination and an absolute lack of clarity in terms of responsibilities”; and d) the absence of an effective system of accountability.

What López-Ayllón depicts is the atmosphere in which the Mexican economy functions day-to-day, and one that can only be aggravated in the case of the energy sector because of the radical nature of the reform in the Mexican context which implies, for example, that Pemex ceases to operate on the basis of massive transfers of resources to the treasury, to be measured with criteria of productivity and profits. This also becomes complicated because of the way that the two entities, one-time monopolies, never characterized as models of probity or efficiency, have operated.

In the case of the potential investors, this involves experienced players who have learned to deal with the planet’s most diverse governments, many of these characterized by dysfunctional and marginally trustworthy regimes. A high-level functionary of a multinational oil company recently affirmed, “all of us would prefer to operate in Switzerland, where the rules of the game are clear and sacrosanct, but oil is discovered in the most recondite and frequently unstable places of the globe”. It is clear that a Swiss legal system is not required, but it is also obvious that a high degree of certainty must be attained in order to get the process going.

Every successful country in these matters has responded to its challenge in a particular way. Colombia transformed its judiciary (a process that took decades), achieving it being perceived as independent from the Executive Branch, thus prone to acting convincingly when a dispute with the Executive presents. Peru created a fully autonomous and credible regulatory entity in those very terms, garnering the respect of all actors in the environment. Some countries have resorted to international courts of law (and some, to the tribunals of other countries) to gain this credibility.

The regime adopted by the Mexican legislation starts out with a problem because it accords greater importance to the Executive Branch (in the form of the Ministries of Energy and  Finance, depending on the matter at hand) than to the autonomy of the regulatory organs. This can be the result of the expectation that the government entertains the credibility necessary to win over the respect of the investors, which entails a bet in these turbulent times.

The alternative explanation, but complementary in a certain way, would be that the legal regime assumes and explicitly recognizes the correlation of forces in Mexican politics; that is, it does not even pretend that the supposedly autonomous entities will act independently; thus, the legal and regulatory structure simply formalizes this circumstance. Be that as it may, the market will decide whether the guarantees and securities that this new regime creates are sufficient to lure investors. It will be a lesson for everyone, including all other issues in the public domain.

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                                                                               Luis Rubio

In Hard Times, Charles Dickens describes in heartrending fashion the effects of the Industrial Revolution on entire populations that wound up forsaken, without work, social security or any other method of survival.  The advent of the steam engine was devastating for manual work, despite the fact that virtually all workers of the time had the possibility of using the new machines. Some learned how, others were left out, suffering the consequences. Although anguishing, this is the history of humanity: Deidre McCloskey has shown how technological change has gone hand in hand with this history; from the invention of the wheel, pulleys and fishing nets, technology has transformed the way of producing and of living. Surely there was a militant and intrepid Trump attempting to harness the raging waters at each of those junctures.

With Trump or without Trump, technology will continue to advance and that is something about which we Mexicans have not taken much notice: the nation’s prototypical industrial plant continues to be rather traditional, in that it involves many persons managing machines, even some of enormous complexity. This is in contrast with the exporting plant and the most modern plants of developed countries, which are replete with robots and in which personnel is quite exceptional. In former times two operators were required per loom; today, a single individual with a computer can simultaneously supervise up to five thousand looms. The change, and the destruction of traditional jobs, is impacting and irrepressible. And it’s nothing new.

This reality entails two enormous challenges for Mexico. On the one hand, sooner or later, the traditional manufacturing plant will be razed by the growing sophistication of productive processes and consumer demands. Suffice to imagine what the multiplication of 3D printers will imply, some that most tiny manufacturing plants in Mexico, Fox’s “changarros,” could not even begin to fathom. Many scholars of the Soviet Union have concluded that it was technological change that really undermined the old Russian empire: in the last analysis, the USSR –with the exception of the military- was incapable of keeping pace with the West. In Mexico we are not far from a similar outcome in the whole old, traditional manufacturing plant that, despite all types of tariff and non-tariff protections and subsidies, it will in the end die. It is not by chance that miracle workers -like Trump in the U.S. and AMLO in Mexico- want to return to that idyllic world of the past in which everything supposedly worked in harmony.

The second challenge is not a lesser one: with Trump or without Trump, the same thing is going to happen even in the most ultramodern sector of the country’s industrial plant, which produces, competes and generates billions of dollars in exports. Technological change is unstoppable and robots are advancing by giant leaps and bounds. While we Mexicans are worried about the preservation and, ideally, the modernization of NAFTA, the industrial world is moving vertiginously toward automation. How are we going to perpetuate comparative advantages to attract new enterprises, investments and industrial plants?  The question is not an idle one: we have been able to entice investments because of the certainty conferred by NAFTA and the competitiveness that we contribute by means of workforce costs and other inputs. What will we do when these inputs, above all personnel costs, become irrelevant because of robotization?

The problem is becoming serious due to some of the initiatives that the new U.S. Government is promoting, such as the repatriation of profits “stationed” outside the U.S. These profits, estimated at more than one trillion dollars, have been left behind because companies do not want to pay a 35% tax to repatriate them. Trump is proposing a very low tax (between 8% and 20% according to the press) for their repatriation, but in exchange for their being utilized for new investments on U.S. soil. Were this initiative to be approved, it is most probable that this capital would be used for high-tech investments, that is, robots, minimizing the employment of blue-collar workers.

For Mexico, this prospect entails two basic consequences: the first, mentioned before, is that it will modify the whole conception of NAFTA from the time it first entered into effect. The second is that, even if we found the way to continue to draw investment in high tech, the impact on employment would be exceedingly harsh. One must not lose sight of the fact that the salaries of Mexican workers in the modern and export sector are several times higher than those in traditional industry. In sum, we are confronting two fundamental challenges: that of continuing to attract investments; and two, dealing with the impact on employment -or, at least, the absence of new job opportunities- in the industrial sector: some lost to automation, others due to the disappearance of traditional manufacturing.

With or without Trump, the challenges to the country’s development cannot other than grow and make each day more complex. Decades of abandon in these matters has caught up with us; we must address all that was left astray before…

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Luis Rubio

Where to start? Security has become the most important matter for the population and, however, we have taken decades without being able to square the circle. The governments -federal and state- hold forth on the matter and propose grand solutions that later come to nothing. Everyone delivers sermons, but insecurity is mounting. For some the problem is one of education, for others one of confronting the criminals; for some the most imperative aspect is to take on crime, while for others the solution lies in greater political control. At the heart of all the proposals there is always a political, ideological or personal agenda that ignores the elemental, which should be the point of departure: the first is to protect the population. From that point forward, it is necessary to construct a reliable security system for that population; everything else is demagoguery.

I would like to believe that, beyond the individual agendas, there exists a generalized coincidence that security is the condition sine-qua-non for the development of a country.  Where the coincidence stops is in the how: from there arise agendas, prejudices and interests, but also, I imagine that most of all, nostalgia for a happy past. For many of Mexico’s politicians and opinion makers, Spanish poet Manrique was right in writing that any past time was better when, in reality, the peace and security that Mexico experienced for some decades was to a greater degree the product of authoritarian controls than that of a system of sustainable security.

If one observes the way that societies with low crime levels function, the Mexican discussion in this regard is senseless. In Japan security begins with the neighborhood police officer, who is a member of the community and knows everyone, thus being capable of identifying abnormalities. Something similar happens in Europe, each country with its own ways and traditions, but the essence is exactly the opposite of what has been proposed in Mexico: security is only possible from the ground up; that is, security cannot be imposed, it must be built. A serious debate, above all in anticipation of the presidential race next year, should be concentrated on constructing a security system of that nature: from below.

Perhaps the most absurd of the discussions of recent years has been that relative to the political “Mando Único,” or united command, meaning a single state police force replacing all municipal contingents. This notion has two types of promoters: those who have a vested interest and those who sought a “realist” solution given the obvious fact that most municipal governments are extremely weak both institutionally and financially. For the former, above all innumerable state governors, insecurity became a unique opportunity to submit the municipal presidents in order to control them and to limit their capacity to act independently. It is not by chance that the most avid drivers of this strategy have been the most satrap governors, often those who constantly challenged the mayors of parties different from theirs (or of whom they feared competition) and with the same political ambitions. The point is that security was not the true objective: from their perspective, the population should fend for itself.

More sensible were those who pursued a solution in the face of the deterioration of security in vast regions of the country where weak municipal authorities meet organized crime head-on: an impossible situation. If the federal government -with the Army, federal police and all of their weapons and resources- has not been able to deal with the narcos, what can be expected of the embattled municipal presidents? As Mark Kleiman, a security expert, says, “the debate over criminal-justice policy often seems to take place between the disciples of Michel Foucault and the disciples of the Marquis de Sade, with the Foucauldians winning the academic debate even as the sadists mostly get their way in the real political world.” In one word, the resulting policies manage to combine enormous cruelty with unsatisfactory crime-control results.

In view of the institutional weakness at all levels of government, the governmental response has been the sole one possible: send in the Army. But soldiers are not trained for police activities and the results have not been successful. That has led to desperation, which immediately rebounds to nostalgia.  Unfortunately, the past is not a viable guide for security in a country as diverse, disperse and complex as the Mexico of today.

It seems to me that there are three obvious principles that should be followed: first, security can only be built from the ground up, thus the relevant question is how to achieve it; second, the federal forces, or even state forces where they are trustworthy, can be deployed to stabilize the local situation: that is, the Army or the Federal Police should have as their mission the pacification of the zones in which they operate, but with a clear objective, which can be no other than to create conditions for constructing local police capacity. Therefore, third, there is the need for what has not been done: a plan for the construction of local security systems from the municipal level and with ample participation of the population affected. The point is that security will never be achieved if there is no understanding that the nodal objective is to protect the population and that, due to this, the population itself must be an integral part of the solution.

As in so many other aspects of our national life, the challenge resides in digging ourselves out of the hole bequeathed to us by the old political system. The problem lies there and will not end until we -all Mexicans- opt to build a “new” country.

www.cidac.org
@lrubiof

Luis Rubio

Moments of malaise are also moments of risk –and of opportunity. The risk of reverting what does function in the interest of achieving redemption, and opportunity to build something new, distinct, that solves the injustices in which the country has become mired. The present moment is ripe for both; the question is how those with real power will contribute and what the potential candidates will furnish. The future of the country rides on this.

The panorama is extremely clear and complex: a population at once courted by all, but also forsaken; everyone wants their vote, but no one wants it to participate, influence nor, much worse, complain. The population is there to serve the politicians: some of the latter direct themselves to the populace to threaten it, others to vow atonement; the President tells us that “today… there are risks of regression… new threats are emerging that represent the paralysis of the right or the jump into the void of the left” because we do know how to govern. Surely he is thinking of the performance of his government over the last two years… For his part, López Obrador volunteers platitudes, such as “the prosperity of the people and the rebirth of Mexico,” an overture that sounds good in the discourse but that is not accompanied by concrete proposals.

And that is the problem: some market the idea that “they know how to govern,” others who know “what to do” and still others state that their forte is “professionalism” and “honesty”, when the evidence is overwhelmingly against all three of these propositions.

In the context of the 2012 campaign, a PRIist governor allowed himself the luxury of stating that “we may be corrupt but we know how to govern,” an excellent prolog for what took place summarily: profuse corruption and incapacity for governing. The presidential speech on the PRI’s birthday was a perfect example of the distance separating the political class from the population.

The book by AMLO reminded me of the stellar work of Czeslaw Milosz, The Captive Mind: the sermonizer has to do no more than denounce the obvious -the decadence, the abuse, the beneficiaries, the corruption- to describe a disastrous scenario that lies behind much of the unease afflicting the population. But the important question, the one posed by Milosz, is why there continue to be subscribers to a motion that has no possibility at all of solving Mexico’s quandaries. López Obrador himself proclaims that we must return to the past. The past? Which one? The past of the crises, of the poor services, of the lack of opportunities? In contrast with the presidential demagoguery, that of the Morena party is vague: the candidate is the solution and one must not zero in on how to solve the problems: that is merely a problem of implementation.

The PANists are not to be outdone. Incapable of governing, they ended up immersed the same corruption rackets as the PRIists, but steeped in internal quarrels and without the capacity to construct solutions. Great ones such as opposition, always disposed to join forces, they proved to be more concerned with moral posturing than with governing.

The panorama explains the discontent and, perhaps, the electoral preferences expressed in the polls: plainly, no party   or candidate satisfies and these perceive no reason to put forth intelligible and precise outlines, susceptible to convincing the electorate. They do not do this because they do not want to commit, because they fear losing disciples among their divided and rancorous devotees.

Tony Blair wrote some days ago that “Today, a distinction that often matters more than the traditional right or left is open vs. closed. The open-minded see globalization as an opportunity but one with challenges that should be mitigated; the close- minded view sees the outside world as a threat.” Will candidates emerge who are capable of explaining the dilemmas with that clarity and of proposing specific actions to face up to the problems and to break once and for all with that nostalgic but unacceptable past?

The country semi-worked during the last decades because NAFTA supplied a source of indisputable certainty, while the U.S. job market released social pressure. Whatever happens in the U.S. in the upcoming months (and I think it will be benign), imported assuredness will no longer be reliable. Now everyone knows that this can disappear and that creates a moment of extreme risk, but also of opportunity: the risk of destroying all that exists (without the penalty that was inherent in NAFTA) and the opportunity to face up to our challenges in order to build sources of certainty founded on internal political arrangements.

Our true dilemma is the same as that of fifty years ago, but it is already unavoidable. The country requires a seamless political transformation based on an effectively represented population, a system of government that responds to the population and a government whose purpose is that absent verb: to govern.

In the face of this, the presidential offer is that of winning the power, because that is what PRIists know how to do; that of AMLO is to attack the “power mafia,” because that is his obsession; and that of the PAN is an honest and professional government, one which they were not able to articulate when they were in power. None of them understand the country of today, that which does not require promises, demagoguery or redeeming moralization. It requires answers. The challenge is internal.

www.cidac.org
@lrubiof

 Luis Rubio

Two months of observing the Trump government begins to furnish a profile of possibilities. Great in rhetoric, candidate Trump was specific solely in some clichés, always leaving the impression that he was going to revolutionize the world. His point of departure was a rejection of what exists, combined with a promise of utopia and redemption for his own. Never again, he vowed in his inaugural discourse, would there be the carnage that characterized his country in earlier decades. The marvel of unachievable promises is that it is not necessary to deliver on them in order to satisfy the hard base. At the same time, promises do not suffice to change the reality.

Two months after the government began, it is possible to start to discern what it wants to achieve and what it is in fact doing to achieve this. The first thing that seems evident to me is that there is a frank disagreement between the majority of analysts and the media -and, certainly, the Democrats- with respect to the facts as they have come about. The rhetoric has been so profuse and confused that the U.S. press and, in general that of the world, has fallen into a game of judgments more than one of analysis. More specifically, Trump and his White House team are evaluated and judged under contextual frameworks that may not applicable to the situation.

My reading of the reality is that Trump is not simply another president with his peculiar emphasis and project of government. Trump came to change the reality and, two months after the government’s inauguration, it appears sufficiently evident that he possesses a very well-conceived and articulated strategy for altering the established order. When Bannon speaks of himself as a Leninist he divulges more than is frequently interpreted: in effect, the objective is to change the status quo, to remove the “elite” from power and to change the political reality. For this to occur they have devoted themselves to undermining one after another of the mechanisms that had for decades constituted the brakes on executive power.   The confrontation with the press is not a misunderstanding and even less so an error: it is a strategy engendered to convert the “representation of the elite” into the opposition.

While the attack strategy on the established order is clear and integral, in addition to being structured, one step following the other, there is nothing similar in place for what happens after. That is, there is clarity on how to advance but not concerning how the objectve is to be achieved. The definition of the political project is so nebulous -general, abstract and, above all, utopic- that accuracy or concretion is not required. In other words, everything suggests that what is being pursued is to break with what exists to afterward begin to think of what to construct or whether to construct something at all. Like so many other populist projects, Trump’s proposes that “the solution is me”; thus, no definition is required. The great question is whether the system of checks and balances will permit him to accomplish this.

The muddle into which the new administration has gotten itself in the health issue is paradigmatic: for years, the mantra among the Republicans was opposition to (therefore, termination of) the health program known colloquially as ObamaCare. Polls showed that the program was highly unpopular among the population in general, although not among the Democratic leaders. Paradoxically, the program was highly unpopular among its beneficiaries, especially when, a few days prior to last November’s election, ObamaCare fees were raised. No one wanted to recognize the evident contradiction: the program might be expensive and less than Obama had promised, but its beneficiaries needed to have some program. Trump and his fellow believers made it to the government and announced the removal of ObamaCare; with that fact, at that very instant, the program suddenly became popular: instead of proposing an alternative, Trump threw himself into the fray like gangbusters, legitimizing the program whose promise of annulment had aided him in reaching at the presidency. Like Nixon going to China, but without proposing it. The plan of attack was obvious, but not the actual response: we first burn the house, then we see what happens.

For Mexico, these experiences supply relevant lessons. Above all, the initial pounding has been losing strength because there was no plan behind the obvious. The excellent management of the visit of the Secretaries of State and Homeland Security allowed the overshadowing of the most radical of the group closest to Trump, making possible the statement of the new Secretary of Commerce in the sense that the negotiation on NAFTA would be benign for the Mexican peso: this exhibited understanding of the enormous risks to the U.S. of persisting in aggressiveness.

The risk, for the U.S. and for Mexico, is that after the massive destruction in which they have incurred –beginning with the U.S. “trademark”-, there is no turning back. Today all Mexicans know that the NAFTA is vulnerable, along with which its function as a source of certainty has deteriorated. I entertain no doubt that a benign resolution will be reached, but the damage done will have been immense. It is for this reason that, after concluding this painful episode, Mexico will have to dedicate itself to building its own sources of certainty, because those of the power of the North are no longer what they were.

www.cidac.org

@lrubiof