FORBES

Luis Rubio

In the independent Mexico there have been two eras of high economic growth: that of the Porfiriato at the end of the XIX Century and the good years of stabilizing development, between the forties and the end of the sixties of the XX Century. The political characteristic of both moments was centralization of power. In a country with such prominent geographic, ethic, demographic and physical dispersion and diversity, the centrifugal forces have always been enormous, the reason why it’s tempting to establish an automatic correlation between the two phenomena: control commensurate with growth; diversity and decentralization commensurate with chaos. However, this correlation is non-existent: there are many factors that intervene. More importantly, the era of globalization creates new realities that make it impossible to establish a causal relationship between political centralization and economic success.

To begin with, the context is decisive: with distinct characteristics, the common denominator between the Porfirio Díaz years and those of stabilizing development was the existence of a capacity of process control, information control and, above all, control of crucial factors such as financial stability, infrastructure development,   credit growth and control of the work force by means of the unions operating under the aegis of an all-powerful government. Some of these factors continue to be crucial to economic growth, but others are the product of the specific moment. The context matters and the current one has changed radically.

Today’s success factors include many of those from the past (such as infrastructure, financial stability and the existence of a functional government), but the key to add value resides in the capacity of individuals to furnish ideas, creativity and, in general, contributions that are the product of intellectual activity that raises productivity in the era of information and services, very distinct from that which preceded it in the agricultural and industrial ambit. In terms of their essence, two things have changed: physical force has been replaced by intellectual creativity and physical boundaries -like national borders- have ceased to be a limiting factor. At present commerce and the exchange of ideas are vital for growth. The importance and transcendence of the government has not changed: what has changed is the nature of its function.

Kofi Annan, former Secretary General of the United Nations, said that “we cannot wait for the government to do everything. Globalization operates on Internet time”. In effect, a government cannot do everything, but in an era of vast change, of permanent change in fact, what is crucial is for the government to adapt itself to the needs of the economy and the society, which undergo constant transformation. Of course, there are leading functions that do not change –such as maintaining the population’s social peace and security- but there are others that modify themselves constantly: some become obsolete, others take on unfathomable transcendence.

The new government has instated itself as a factor of control and of power. With this it has been able to devise the perception that the solutions to the dilemmas facing the country are found in its hands. This is no small achievement, above all after an era of conflict, violence and uncertainty that began in 1994 and only got worse. The presence of a government that emblemizes a sense of authority with its presence has been welcomed by the population. However, the form and content that it has exhibited to date is very similar to that of the sixties of the past century, as if it were keen on recreating that era. The problem is that both globalization as well as the factors that make success possible at present alters the panorama. Success today depends on the existence of a government that works but also on an economic strategy compatible with the reality of globalization and with the characteristics of an economy in which the manpower component is increasingly less relevant in terms of adding value. Instead of controlling the population, what must be created is an educative, health and cultural environment that favors the development of human capital; rather than control over the economy the key lies in promoting entrepreneurial activity, eliminating restrictions and allowing for constant change.

The key in the era of globalization resides in the capacity of individuals to create and add value as well as to increase productivity. The presence of a strong government with clearness of vision is a crucial factor in the process, as long as it plies this strength to engender conditions for progress and not merely for controlling the population. That is, in this historic era, control and development are contradictory.  If one desires to achieve the latter it will be imperative to employ the former with parsimony and intelligence.

www.cidac.org

@lrubiof

Luis Rubio

Is it possible for nature to be benevolent to some nations and ruthless with others? Judging by the way that a hurricane devastated Haiti some years ago, the answer would appear to be obvious. But that’s not the one that Bruce Bueno de Mesquita and Alastair Smith provide in a book that not only probes into the very entrails of power, but also that is entitled “The Dictator’s Handbook: Why Bad Behavior Is Almost Always Good Politics”. For these authors everything abides by the political structures of a society and not to Mother Nature. Hurricanes, earthquakes, volcanic eruptions and other natural phenomena are daily events worldwide. What’s not evident, say these authors, is that natural disasters –the effect of the physical phenomenon- disproportionally hit the poorest most underdeveloped countries.

This question has always intrigued me. In 1978, when I was studying in Boston, there was a brutal snowstorm that paralyzed the city for nearly a week and destroyed hundreds of homes along the coast. However, the capacity of the governmental response was impacting: the speed with which they cleaned up the streets, saw to the victims and reconstructed the homes –now with a new construction code so it wouldn’t happen again-, and made it possible for the city to go back to normal quickly. The devastation was enormous, but the government’s performance was spectacular. The way the Mexican government conducted itself after the terrible explosion at San Juanico (San Juan Ixhuatepec) or during the 1985 earthquake in Mexico City was brutish. No one can avoid natural phenomena or accidents, but the essence of the governmental structure and its relation with the society made a huge difference once these had taken place.

The argument of these scholars stems from the principle that the structure and strength of the institutions on which a society relies exerts an exorbitant impact on the result. Of course incidents occur; what varies is the form (and capacity) of the response. The theme returned my thoughts to the recent explosion of a dual tank gas truck in San Pedro Xalostoc. While one could extrapolate the argument of these authors to the regulations that standardize, permit or impede the transport of this type of fuel, accidents of this kind are no novelty in Europe, Japan or the U.S. A short while ago a fertilizer factory exploded in Waco, Texas, killing dozens of people. Three years ago there was an accident in a nuclear plant in Japan, but a year later all of the inhabitants of the region had thoroughly sorted out their lives.

Tragic events, those caused by nature as well as those materializing as the result of industrial accidents, are part of life. What differentiates some nations from others is the governmental response capacity and, above all, it is the functionality of day-to-day governmental management that make it possible for the impact or consequences of this type of events to be of such different magnitudes. And that, say the authors, has everything to do with the nature of their political system.

For those who remember the 1985 quake in Mexico City, the government was taken by surprise much as the proverbial deer frozen in the headlights of a car. There were no established procedures, the most important rescue operation was carried out by volunteers, brigades of disaster specialists from places such as Italy with their canine units trained for this type of circumstances were much in evidence and there were notable efforts by individuals like Plácido Domingo who came to search for their relatives in Tlatelolco. What wasn’t there was the government. Worse: the earthquake evidenced the virtual inexistence of government: it had not been present when the building permits were issued nor was it present when the conclusion of those buildings was authorized, when the disaster itself came or when it was required to act in attending to victims as well as to reestablishing a semblance of order in the functioning of Mexico City.

The 1985 quake in the Mexican capital is a good paragon of the before and after because, in retrospect, from that there arose a political watershed perhaps greater than that of 1968. The government responded to the grisly events at Tlatelolco (1968) with a strategy that was dire for the economy but its political logic was impeccable: it brought about the inclusion of a population that had been excluded in the political process without losing control of the system. In contrast, the quake marked the beginning of the collapse of the old system: not only had the government gone broke a couple of years earlier (1982), but also it now revealed that it did not possess the capacity to act and respond. It was from that time that what ended up as a key component of the PRD was born.

Above all, since then a process of political and economic reform began that changed (transformed would be an excessive characterization) the country. Not the least doubt remains that the country has improved since 1985, as illustrated by the spectacular response capacity that has been constructed in the case of hurricanes that, we must recall, even made it possible for a Mexican military contingent to be deployed to the U.S. when Katrina struck New Orleans.

The Bueno de Mesquita and Smith argument can be summed up in one idea: a government or a leader will exercise all of the power it/he has and will employ it for self-preservation. If that power is not delimited by means of institutional mechanisms (the authors cite in particular transparency, accountability and checks and balances), its/his proclivity for abuse is infinite. Thus the authors conclude why countries like Haiti are much more vulnerable to hurricanes than other neighboring islands; that the existence of vast resources (such as oil) augurs well for autocratic regimes; that the salaries of lesser authorities tend to be extraordinarily high in underdeveloped countries; and that the stronger the concentration of power, the greater the temptation to hinder the development of checks on their power which, note the authors, is what differentiates the way the German government responds to an accident or an act of nature from what the Bangladesh government does about it.

In colloquial terms, governments and leaders act within the power framework afforded them, that is, when they abuse this they do so because they can. The experience of Mexico from 1895 on is of clear institutional strengthening but, as instanced by the rampant criminality, there’s much more lacking than that in which headway has been made. All things considered, what there’s no doubt about, as Ecatepec recently brought home, is that the response capacity is growing and improving. Next in line come the police and the judiciary…

www.cidac.org

@lrubiof

Luis Rubio

Is it possible for nature to be benevolent to some nations and ruthless with others? Judging by the way that a hurricane devastated Haiti some years ago, the answer would appear to be obvious. But that’s not the one that Bruce Bueno de Mesquita and Alastair Smith provide in a book that not only probes into the very entrails of power, but also that is entitled “The Dictator’s Handbook: Why Bad Behavior Is Almost Always Good Politics”. For these authors everything abides by the political structures of a society and not to Mother Nature. Hurricanes, earthquakes, volcanic eruptions and other natural phenomena are daily events worldwide. What’s not evident, say these authors, is that natural disasters –the effect of the physical phenomenon- disproportionally hit the poorest most underdeveloped countries.

This question has always intrigued me. In 1978, when I was studying in Boston, there was a brutal snowstorm that paralyzed the city for nearly a week and destroyed hundreds of homes along the coast. However, the capacity of the governmental response was impacting: the speed with which they cleaned up the streets, saw to the victims and reconstructed the homes –now with a new construction code so it wouldn’t happen again-, and made it possible for the city to go back to normal quickly. The devastation was enormous, but the government’s performance was spectacular. The way the Mexican government conducted itself after the terrible explosion at San Juanico (San Juan Ixhuatepec) or during the 1985 earthquake in Mexico City was brutish. No one can avoid natural phenomena or accidents, but the essence of the governmental structure and its relation with the society made a huge difference once these had taken place.

The argument of these scholars stems from the principle that the structure and strength of the institutions on which a society relies exerts an exorbitant impact on the result. Of course incidents occur; what varies is the form (and capacity) of the response. The theme returned my thoughts to the recent explosion of a dual tank gas truck in San Pedro Xalostoc. While one could extrapolate the argument of these authors to the regulations that standardize, permit or impede the transport of this type of fuel, accidents of this kind are no novelty in Europe, Japan or the U.S. A short while ago a fertilizer factory exploded in Waco, Texas, killing dozens of people. Three years ago there was an accident in a nuclear plant in Japan, but a year later all of the inhabitants of the region had thoroughly sorted out their lives.

Tragic events, those caused by nature as well as those materializing as the result of industrial accidents, are part of life. What differentiates some nations from others is the governmental response capacity and, above all, it is the functionality of day-to-day governmental management that make it possible for the impact or consequences of this type of events to be of such different magnitudes. And that, say the authors, has everything to do with the nature of their political system.

For those who remember the 1985 quake in Mexico City, the government was taken by surprise much as the proverbial deer frozen in the headlights of a car. There were no established procedures, the most important rescue operation was carried out by volunteers, brigades of disaster specialists from places such as Italy with their canine units trained for this type of circumstances were much in evidence and there were notable efforts by individuals like Plácido Domingo who came to search for their relatives in Tlatelolco. What wasn’t there was the government. Worse: the earthquake evidenced the virtual inexistence of government: it had not been present when the building permits were issued nor was it present when the conclusion of those buildings was authorized, when the disaster itself came or when it was required to act in attending to victims as well as to reestablishing a semblance of order in the functioning of Mexico City.

The 1985 quake in the Mexican capital is a good paragon of the before and after because, in retrospect, from that there arose a political watershed perhaps greater than that of 1968. The government responded to the grisly events at Tlatelolco (1968) with a strategy that was dire for the economy but its political logic was impeccable: it brought about the inclusion of a population that had been excluded in the political process without losing control of the system. In contrast, the quake marked the beginning of the collapse of the old system: not only had the government gone broke a couple of years earlier (1982), but also it now revealed that it did not possess the capacity to act and respond. It was from that time that what ended up as a key component of the PRD was born.

Above all, since then a process of political and economic reform began that changed (transformed would be an excessive characterization) the country. Not the least doubt remains that the country has improved since 1985, as illustrated by the spectacular response capacity that has been constructed in the case of hurricanes that, we must recall, even made it possible for a Mexican military contingent to be deployed to the U.S. when Katrina struck New Orleans.

The Bueno de Mesquita and Smith argument can be summed up in one idea: a government or a leader will exercise all of the power it/he has and will employ it for self-preservation. If that power is not delimited by means of institutional mechanisms (the authors cite in particular transparency, accountability and checks and balances), its/his proclivity for abuse is infinite. Thus the authors conclude why countries like Haiti are much more vulnerable to hurricanes than other neighboring islands; that the existence of vast resources (such as oil) augurs well for autocratic regimes; that the salaries of lesser authorities tend to be extraordinarily high in underdeveloped countries; and that the stronger the concentration of power, the greater the temptation to hinder the development of checks on their power which, note the authors, is what differentiates the way the German government responds to an accident or an act of nature from what the Bangladesh government does about it.

In colloquial terms, governments and leaders act within the power framework afforded them, that is, when they abuse this they do so because they can. The experience of Mexico from 1895 on is of clear institutional strengthening but, as instanced by the rampant criminality, there’s much more lacking than that in which headway has been made. All things considered, what there’s no doubt about, as Ecatepec recently brought home, is that the response capacity is growing and improving. Next in line come the police and the judiciary…

www.cidac.org

@lrubiof

Luis Rubio

“Raise ravens and they’ll pluck your eyes out” goes the refrain that Carlos Saura employed in his movie “Cría cuervos y te Sacarán los ojos” so rightly. The same can be said for all of the unions, radical groups, dissidents and parallel organizations that the PRIists and their acolytes created over time with the idea of these serving to counterbalance or as alternatives in the face of the excesses of their own constituencies. Fifty years later, the reality is quite distinct: the original party sectors (workers, peasants and the so-called “popular”) languish (although their leaders continue to plunder) while the groups engendered as supposed counterweights defy the government in Guerrero, Oaxaca and in diverse sectors of the economy. A government that aspires to enforce its authority will not achieve this insofar as it does not put its own house in order.

In the Greek tragedies the audience knows ahead of time that the matter will end in disaster. The only ones who appear to be undaunted are the bureaucrats and politicians who imagine, as if they thought of themselves as Sophocles, that they can avoid the horror to come. The tragedy unfolds and plays out toward its inevitable conclusion, but the actors seem impassive, ignorant of what is to follow. They brought about the phenomenon, financed and drove it, but are not responsible for anything. The tragedy develops as if it were an inexorable process, one in which no one can interfere. The only thing left is arrogance, pride and the politician’s deception because, although clearly being the guilty parties, they exist in a state of forgetfulness, adopting maximalist stances, as if their actions involved no consequences. History is marked by politicians who changed parties, acquired new loyalties or continue, deep down, to espouse the same ones, but who are incapable of uttering a lone mea culpa. What is left are union bosses who everyone now wants to forget, the guerillas created ex profeso, the dissidents operating under the auspices of the federal government and the paid demonstrators. What can’t be ignored are the consequences for the peace of the country and for the daily lives of the citizenry.

If one does not accept the origin of the rampant disorder it is impossible to respond or, more to the point, to aspire to recovering the authority’s legitimacy. It’s easy is place the blame on whatever or whichever ex-president or party, but the reality is that the disorder in the country began as far back as 1968 and nothing since then has altered the trend. I don’t want to suggest with this that all governments after that date were dishonest, ignorant or irresponsible. The point is not to grade them but to ascertain the reality in which we live today.

The disorder was the product of two factors that were in certain fashion contradictory. One was the decision (explicit or implicit) of the governments to abdicate their responsibility of governing, defining this as keeping the peace, creating conditions for the country’s development, penalizing clearly illegal behaviors and adhering to the mandate of the law and that of the institutional framework. Governmental paralysis set in due to the weight of the sensation of the illegitimacy that characterized the PRIists since then and of the PANists’ incompetence that came later. This factor is no longer real.

The other factor that led to the current disorder concerns the clash of perceptions, realities and actions that has distinguished public policy making in these decades and that has paralyzed the present government. First is the fact of Mexico’s open economy. Although many continue to dispute and condemn the fact, the reality is that the Mexican economy has been basically open since the mid-eighties; contradictions in the bosom of this opening and the absurdities that some of its limitations has spawned can be discussed, but the fact is that the main motor of the Mexican economy are its exports. This can please or displease, but nothing changes the facts. The government can accept or reject this reality, but it would be to its benefit to accept it soon.

In second place we come upon the immaculate past, this as if it were an absolute condition. From the past emanate all of our myths and others that have been affixed to these. Here we encounter an obsolete petroleum policy, apathy about gas, the myths about the U.S., the lack of recognition of the chaos that specific PRIists generated in their pursuit of power without making amends for the costs and risks entailed in their actions, and the pretension that it is possible to differentiate between domestic and foreign investors. In a global economy the only thing that exists is a market in which investors require judicial, patrimonial and physical certainty, energy resources and functional dialogue with the government. If order is sought, we must begin by resolving the problems and myths generated in the PRIist  tent, that of today and that of before.

Finally, perhaps the country’s greatest challenge can be summed up in a very simple contraposition: modernity vs. tradition. Modernity implies constructing the country in form: with all of the structures of authority, but also with the checks and balances that are crucial for guaranteeing certainty to the population, to the investors and to our foreign partners. Modernity implies a government capable of acting (and the present one has exhibited an abundant capacity for this) but also a viable and realistic development project, something that does not appear to be present in the contemporary vision.

What’s important to citizens is a functional government that does not abuse them as well as a growing economy. This is a definition of modernity that, it seems to me, the entire population would accept. The problem is that as long as the government does not embrace modernity as its own, the latter will never put in an appearance.

Within this context it is logical for the population to subscribe more to skepticism than to the optimism evinced by international publications. Surveys show an acute abyss between the population’s opinions with respect to those of the opinion makers. The experience of past few presidential terms suggests that, to the degree that there is a divorce between both contingents, the government will come out losing. Will Rogers, an American actor of the early 1900s, said it well: “it’s easy to be a humorist, you have the whole government working for you”.

The last thing President Peña’s government wants is for the population to end up engulfed in the traditional pessimism of the Mexican, but the only way to avoid this is guaranteeing its rights and freedoms and achieving sustainable economic growth. Ironically, in contrast with the PRIist era of yesteryear, both will coincide when the government accepts the legitimacy it earned in the ballot boxes and complies with its responsibility of enforcing the law and constructing solid and permanent institutions.

www.cidac.org

@lrubiof

Luis Rubio

“Raise ravens and they’ll pluck your eyes out” is the epitaph of Carlos Saura’s extraordinary film Cría Cuervos. The same can be said for all of the unions, radical groups, dissidents and parallel organizations that the PRIists and their acolytes created over time with the idea of these serving to counterbalance or as alternatives in the face of the excesses of their own constituencies. Fifty years later, the reality is quite distinct: the original party sectors (workers, peasants and the so-called “popular”) languish (although their leaders continue to plunder) while the groups engendered as supposed counterweights defy the government in Guerrero, Oaxaca and in diverse sectors of the economy. A government that aspires to enforce its authority will not achieve this insofar as it does not put its own house in order.

In the Greek tragedies the audience knows ahead of time that the matter will end in disaster. The only ones who appear to be undaunted are the bureaucrats and politicians who imagine, as if they thought of themselves as Sophocles, that they can avoid the horror to come. The tragedy unfolds and plays out toward its inevitable conclusion, but the actors seem impassive, ignorant of what is to follow. They brought about the phenomenon, financed and drove it, but are not responsible for anything. The tragedy develops as if it were an inexorable process, one in which no one can interfere. The only thing left is arrogance, pride and the politician’s deception because, although clearly being the guilty parties, they exist in a state of forgetfulness, adopting maximalist stances, as if their actions involved no consequences. History is marked by politicians who changed parties, acquired new loyalties or continue, deep down, to espouse the same ones, but who are incapable of uttering a lone mea culpa. What is left are union bosses who everyone now wants to forget, the guerillas created ex profeso, the dissidents operating under the auspices of the federal government and the paid demonstrators. What can’t be ignored are the consequences for the peace of the country and for the daily lives of the citizenry.

If one does not accept the origin of the rampant disorder it is impossible to respond or, more to the point, to aspire to recovering the authority’s legitimacy. It’s easy is place the blame on whatever or whichever ex-president or party, but the reality is that the disorder in the country began as far back as 1968 and nothing since then has altered the trend. I don’t want to suggest with this that all governments after that date were dishonest, ignorant or irresponsible. The point is not to grade them but to ascertain the reality in which we live today.

The disorder was the product of two factors that were in certain fashion contradictory. One was the decision (explicit or implicit) of the governments to abdicate their responsibility of governing, defining this as keeping the peace, creating conditions for the country’s development, penalizing clearly illegal behaviors and adhering to the mandate of the law and that of the institutional framework. Governmental paralysis set in due to the weight of the sensation of the illegitimacy that characterized the PRIists since then and of the PANists’ incompetence that came later. This factor is no longer real.

The other factor that led to the current disorder concerns the clash of perceptions, realities and actions that has distinguished public policy making in these decades and that has paralyzed the present government. First is the fact of Mexico’s open economy. Although many continue to dispute and condemn the fact, the reality is that the Mexican economy has been basically open since the mid-eighties; contradictions in the bosom of this opening and the absurdities that some of its limitations has spawned can be discussed, but the fact is that the main motor of the Mexican economy are its exports. This can please or displease, but nothing changes the facts. The government can accept or reject this reality, but it would be to its benefit to accept it soon.

In second place we come upon the immaculate past, this as if it were an absolute condition. From the past emanate all of our myths and others that have been affixed to these. Here we encounter an obsolete petroleum policy, apathy about gas, the myths about the U.S., the lack of recognition of the chaos that specific PRIists generated in their pursuit of power without making amends for the costs and risks entailed in their actions, and the pretension that it is possible to differentiate between domestic and foreign investors. In a global economy the only thing that exists is a market in which investors require judicial, patrimonial and physical certainty, energy resources and functional dialogue with the government. If order is sought, we must begin by resolving the problems and myths generated in the PRIist  tent, that of today and that of before.

Finally, perhaps the country’s greatest challenge can be summed up in a very simple contraposition: modernity vs. tradition. Modernity implies constructing the country in form: with all of the structures of authority, but also with the checks and balances that are crucial for guaranteeing certainty to the population, to the investors and to our foreign partners. Modernity implies a government capable of acting (and the present one has exhibited an abundant capacity for this) but also a viable and realistic development project, something that does not appear to be present in the contemporary vision.

What’s important to citizens is a functional government that does not abuse them as well as a growing economy. This is a definition of modernity that, it seems to me, the entire population would accept. The problem is that as long as the government does not embrace modernity as its own, the latter will never put in an appearance.

Within this context it is logical for the population to subscribe more to skepticism than to the optimism evinced by international publications. Surveys show an acute abyss between the population’s opinions with respect to those of the opinion makers. The experience of past few presidential terms suggests that, to the degree that there is a divorce between both contingents, the government will come out losing. Will Rogers, an American actor of the early 1900s, said it well: “it’s easy to be a humorist, you have the whole government working for you”.

The last thing President Peña’s government wants is for the population to end up engulfed in the traditional pessimism of the Mexican, but the only way to avoid this is guaranteeing its rights and freedoms and achieving sustainable economic growth. Ironically, in contrast with the PRIist era of yesteryear, both will coincide when the government accepts the legitimacy it earned in the ballot boxes and complies with its responsibility of enforcing the law and constructing solid and permanent institutions.

www.cidac.org

@lrubiof

 REFORMA

Luis Rubio

Mexican governments have been talking about reforms for decades. The issue has become a mantra: without reforms, they say, it is impossible to achieve high growth rates. Act Two, from the eighties on, a not inconsequential number of reforms have been proposed, the majority of which have had benign effects. In objective terms, the country has been transformed during these years and many things have improved in impacting fashion. However, two paradoxical things have taken place: on the one hand, the mantra of the reforms remains alive and well and is the source of controversy and permanent political conflict. On the other hand, no one seems to be satisfied with the results.

David Konzevik, an exceptional observer of this changing world, years ago developed a thesis on the “Revolution of Expectations”, with which he explains that, in a globalized world, it doesn’t matter how much the reality has improved if the perception –the latter understood as the comparison people make with what happens in other latitudes- is that much is lacking to catch up with the others. From this relativity, states Konsevik, emanate many of the problems of governance and stability of emerging countries. The thesis explains the side of expectations and perceptions, thus of a key source of conflict. What this leaves for analysis is why reforms, supposedly conceived of and designed to improve the reality and render possible a favorable comparison with other nations, do not fulfill their mission.

The answer doubtlessly lies in the basic problem of reforms: to be successful, reforms entail affecting interests, precisely those that benefit from the status quo. If one accepts the notion that to reform implies affecting interests, then the conflict that lies behind the reforms –in fiscal as well as in labor, energy or education- contains very little of the ideological and a great deal of the substantive. Ideology and discourse are instruments to appeal to people’s emotions, garnering supporters and creating a sensation of chaos and epic conflagration. What are relevant are the interests.

Many of the reforms that come to be formally proposed are already impaired by many limitations. In the eighties, the main problem was the inherent contradiction in the reform project: the government wanted to reactivate the economy but didn’t want to undermine the structure of PRIist interests. This rationale entailed evident consequences: the economy advanced on some fronts but continued to be immobilized on others. The relevant question is whether something changed between then and now. In that era the government understood the need for reform, but its ulterior motive was to maintain power. Now that there have been two processes of alternation of parties in government, it is reasonable to ask whether the rationale has changed. One possibility is that, given that the PRI never had to reform itself, the logic continues intact. Another would indicate that it is precisely to preserve the power in a competitive political environment, that the government has all of the incentives to reform properly and fleet-footedly. Time will tell which of these possibilities proved to be the right one.

In their public dimension, reforms have two moments of dispute and much of their limited achievement is explained by the excessive concentration of debate in the first of these. The initial dispute is always in Congress, for it is there that the content of what is proposed to be reformed is debated. It is there that the defense and attack are concentrated –as well as the eye of the analysts and politicians- and where the special interests and those promoting the reforms butt heads. However, beyond the disputes, history shows that, however diluted, many of the proposed reforms are ultimately adopted but the reality practically doesn’t change. The question is why.

The answer lies at the second moment of the reforms: what’s really transcending about a reform is its process of implementation. We all know that in Mexico there’s an enormous gap between the letter of the law and the reality; in the matter of reforms the relevant moment is when a law (a given reform) has to be made effective. The execution of what is proposed for reform is where the true test of the capacity of transformation lies, for it is there, in real life, where the special interests and those charged with turning the reform into reality confront each other. It is at this second moment where, in many cases, Mexico has failed miserably.

Some of the failures are directly concerned with the way the reform itself was decided upon and there is no better example than that of the privatizations, in which the criterion was fiscal revenue and not industrial organization, that is, the manner in which the respective market would function after the transfer is carried out of the privatized entity to a private entrepreneur. Others fail due to their poor or incomplete implementation. For example, some international companies affirm that, in the case of deep-water oil, the law is sufficient for them to be able to compete for a contract, but also that they anticipate an enormous political conflict the day that a bidding process for a contract were to be announced. That is, the law has been reformed but not so the reality,

However conflictive the approval process of a reform, the crucial moment is that of implementation. A reform of the educational system implies a change in the relationship of the government with over one million teachers and the entire structure of union leadership as well as the bureaucracy. Reforming PEMEX would imply, first turning PEMEX into a company rather than the bureaucratic-political entity that grants favors, corruption and slush funds. A reform in any of these ambits implies a political operation of tremendous scope and risks. The point is that the execution of a reform process is much more complex than the debate at the legislative level that precedes it. It is here that the reform touches ground: where it triumphs or fails. Where it achieves a positive result or a mediocre one.

In his great history on the end of the Roman Empire, Edward Gibbon wrote that, for change, “a heart to resolve, a head to contrive, and a hand to execute” are required. What Gibbon knew in the XVIII Century continues to be valid today: a reform is irrelevant if not administered to perfection and this demands a great capacity of political operation. This capacity is inherent in the present government. What remains to be seen is the quality of the reforms that it ends promoting and its willingness for affecting the beneficiaries of the status quo, many of these close to the heart of the PRI.

Luis Rubio

Mexican governments have been talking about reforms for decades. The issue has become a mantra: without reforms, they say, it is impossible to achieve high growth rates. Act Two, from the eighties on, a not inconsequential number of reforms have been proposed, the majority of which have had benign effects. In objective terms, the country has been transformed during these years and many things have improved in impacting fashion. However, two paradoxical things have taken place: on the one hand, the mantra of the reforms remains alive and well and is the source of controversy and permanent political conflict. On the other hand, no one seems to be satisfied with the results.

David Konzevik, an exceptional observer of this changing world, years ago developed a thesis on the “Revolution of Expectations”, with which he explains that, in a globalized world, it doesn’t matter how much the reality has improved if the perception –the latter understood as the comparison people make with what happens in other latitudes- is that much is lacking to catch up with the others. From this relativity, states Konsevik, emanate many of the problems of governance and stability of emerging countries. The thesis explains the side of expectations and perceptions, thus of a key source of conflict. What this leaves for analysis is why reforms, supposedly conceived of and designed to improve the reality and render possible a favorable comparison with other nations, do not fulfill their mission.

The answer doubtlessly lies in the basic problem of reforms: to be successful, reforms entail affecting interests, precisely those that benefit from the status quo. If one accepts the notion that to reform implies affecting interests, then the conflict that lies behind the reforms –in fiscal as well as in labor, energy or education- contains very little of the ideological and a great deal of the substantive. Ideology and discourse are instruments to appeal to people’s emotions, garnering supporters and creating a sensation of chaos and epic conflagration. What are relevant are the interests.

Many of the reforms that come to be formally proposed are already impaired by many limitations. In the eighties, the main problem was the inherent contradiction in the reform project: the government wanted to reactivate the economy but didn’t want to undermine the structure of PRIist interests. This rationale entailed evident consequences: the economy advanced on some fronts but continued to be immobilized on others. The relevant question is whether something changed between then and now. In that era the government understood the need for reform, but its ulterior motive was to maintain power. Now that there have been two processes of alternation of parties in government, it is reasonable to ask whether the rationale has changed. One possibility is that, given that the PRI never had to reform itself, the logic continues intact. Another would indicate that it is precisely to preserve the power in a competitive political environment, that the government has all of the incentives to reform properly and fleet-footedly. Time will tell which of these possibilities proved to be the right one.

In their public dimension, reforms have two moments of dispute and much of their limited achievement is explained by the excessive concentration of debate in the first of these. The initial dispute is always in Congress, for it is there that the content of what is proposed to be reformed is debated. It is there that the defense and attack are concentrated –as well as the eye of the analysts and politicians- and where the special interests and those promoting the reforms butt heads. However, beyond the disputes, history shows that, however diluted, many of the proposed reforms are ultimately adopted but the reality practically doesn’t change. The question is why.

The answer lies at the second moment of the reforms: what’s really transcending about a reform is its process of implementation. We all know that in Mexico there’s an enormous gap between the letter of the law and the reality; in the matter of reforms the relevant moment is when a law (a given reform) has to be made effective. The execution of what is proposed for reform is where the true test of the capacity of transformation lies, for it is there, in real life, where the special interests and those charged with turning the reform into reality confront each other. It is at this second moment where, in many cases, Mexico has failed miserably.

Some of the failures are directly concerned with the way the reform itself was decided upon and there is no better example than that of the privatizations, in which the criterion was fiscal revenue and not industrial organization, that is, the manner in which the respective market would function after the transfer is carried out of the privatized entity to a private entrepreneur. Others fail due to their poor or incomplete implementation. For example, some international companies affirm that, in the case of deep-water oil, the law is sufficient for them to be able to compete for a contract, but also that they anticipate an enormous political conflict the day that a bidding process for a contract were to be announced. That is, the law has been reformed but not so the reality,

However conflictive the approval process of a reform, the crucial moment is that of implementation. A reform of the educational system implies a change in the relationship of the government with over one million teachers and the entire structure of union leadership as well as the bureaucracy. Reforming PEMEX would imply, first turning PEMEX into a company rather than the bureaucratic-political entity that grants favors, corruption and slush funds. A reform in any of these ambits implies a political operation of tremendous scope and risks. The point is that the execution of a reform process is much more complex than the debate at the legislative level that precedes it. It is here that the reform touches ground: where it triumphs or fails. Where it achieves a positive result or a mediocre one.

In his great history on the end of the Roman Empire, Edward Gibbon wrote that, for change, “a heart to resolve, a head to contrive, and a hand to execute” are required. What Gibbon knew in the XVIII Century continues to be valid today: a reform is irrelevant if not administered to perfection and this demands a great capacity of political operation. This capacity is inherent in the present government. What remains to be seen is the quality of the reforms that it ends promoting and its willingness for affecting the beneficiaries of the status quo, many of these close to the heart of the PRI.

FORBES- Luis Rubio

In the independent Mexico there have been two eras of high economic growth: that of the Porfiriato at the end of the XIX Century and the good years of stabilizing development, between the forties and the end of the sixties of the XX Century. The political characteristic of both moments was centralization of power. In a country with such prominent geographic, ethic, demographic and physical dispersion and diversity, the centrifugal forces have always been enormous, the reason why it’s tempting to establish an automatic correlation between the two phenomena: control commensurate with growth; diversity and decentralization commensurate with chaos. However, this correlation is non-existent: there are many factors that intervene. More importantly, the era of globalization creates new realities that make it impossible to establish a causal relationship between political centralization and economic success.

To begin with, the context is decisive: with distinct characteristics, the common denominator between the Porfirio Díaz years and those of stabilizing development was the existence of a capacity of process control, information control and, above all, control of crucial factors such as financial stability, infrastructure development,   credit growth and control of the work force by means of the unions operating under the aegis of an all-powerful government. Some of these factors continue to be crucial to economic growth, but others are the product of the specific moment. The context matters and the current one has changed radically.

Today’s success factors include many of those from the past (such as infrastructure, financial stability and the existence of a functional government), but the key to add value resides in the capacity of individuals to furnish ideas, creativity and, in general, contributions that are the product of intellectual activity that raises productivity in the era of information and services, very distinct from that which preceded it in the agricultural and industrial ambit. In terms of their essence, two things have changed: physical force has been replaced by intellectual creativity and physical boundaries -like national borders- have ceased to be a limiting factor. At present commerce and the exchange of ideas are vital for growth. The importance and transcendence of the government has not changed: what has changed is the nature of its function.

Kofi Annan, former Secretary General of the United Nations, said that “we cannot wait for the government to do everything. Globalization operates on Internet time”. In effect, a government cannot do everything, but in an era of vast change, of permanent change in fact, what is crucial is for the government to adapt itself to the needs of the economy and the society, which undergo constant transformation. Of course, there are leading functions that do not change –such as maintaining the population’s social peace and security- but there are others that modify themselves constantly: some become obsolete, others take on unfathomable transcendence.

The new government has instated itself as a factor of control and of power. With this it has been able to devise the perception that the solutions to the dilemmas facing the country are found in its hands. This is no small achievement, above all after an era of conflict, violence and uncertainty that began in 1994 and only got worse. The presence of a government that emblemizes a sense of authority with its presence has been welcomed by the population. However, the form and content that it has exhibited to date is very similar to that of the sixties of the past century, as if it were keen on recreating that era. The problem is that both globalization as well as the factors that make success possible at present alters the panorama. Success today depends on the existence of a government that works but also on an economic strategy compatible with the reality of globalization and with the characteristics of an economy in which the manpower component is increasingly less relevant in terms of adding value. Instead of controlling the population, what must be created is an educative, health and cultural environment that favors the development of human capital; rather than control over the economy the key lies in promoting entrepreneurial activity, eliminating restrictions and allowing for constant change.

The key in the era of globalization resides in the capacity of individuals to create and add value as well as to increase productivity. The presence of a strong government with clearness of vision is a crucial factor in the process, as long as it plies this strength to engender conditions for progress and not merely for controlling the population. That is, in this historic era, control and development are contradictory.  If one desires to achieve the latter it will be imperative to employ the former with parsimony and intelligence.

www.cidac.org
@lrubiof

Luis Rubio

The country continues to be divided, not only in positions and preferences but also in the concept of how Mexicans find themselves as a society. For some Mexicans blocking a highway is something natural and acceptable: all’s fair in love and war. For others the blocking of a means of communication constitutes a constitutional violation. For the former the use of force is tantamount to repression, thus reprehensible and should never take place; for others, force is a central instrument of the rule of law. This is about not only views at cross-purposes but also about radically different lifestyles: for some “the worse the better”, for others “we’re just getting along”. In the last analysis, the deep-seated issues that confront Mexican society are never confronted: the division that stupefies the country and that hinders it from constructing a platform of development in which we all dovetail. None of this is new, but the terrible thing about it is that for fifty years Mexicans have been, at least since 1968, entangled in this labyrinth and there’s nothing to suggest that we have advanced even an iota.

It’s easy to assign blame, insults or epithets in every direction, as has happened with the roadblocks organized by National Coordination of Education Workers (CNTE) zealots, but that won’t get us very far. To the extent that these groups live within an environment or a power rationale distinct from that of those who accept the formal rules of the game (be these wrong, wanting or insufficient), the rules are inapplicable. From this perspective, it’s worthless to condemn a behavior when the selfsame objective of an individual who behaves in a determined manner is to make the opposition or reprehension of the normative framework felt that “others” consider valid. The contradiction is what lies at the heart of the level of conflict that the country is undergoing (without including organized crime, another matter entirely) and due to which, for decades, there has been not even an attempt at response.

Worse yet, the existence of views, positions and strategies at cross-purposes has fostered the development of an entire industry of political manipulation –created and fostered from the government and then found uncontrollable-, much of which is inspired less by great philosophical principles or ideals than by the most mundane pragmatism, known in the dictionary as blackmail and extortion. That’s how Mexico City became the oasis of demonstrations or how, instead of seeking solutions to the core problematic, some unions have preyed upon, some presidential candidacies have been launched solely on the basis of resentment, or how some politicians have taken refuge behind ever higher walls: the official presidential residence Los Pinos is a good example of this.

The blackmail industry today includes everyone: from the governor who appears to demonstrate alone in front of the National Palace to those who commandeer conflict in the most remote nook and cranny of the country to Insurgentes Avenue, not to resolve the problems of the indigenous but rather to nudge along their own personal cause. Between one thing and another are secreted dissidents, negotiators and blackmailers. But the underlying point is not the blackmail industry but the fact that in effect there is an essential cleavage at the heart of the country and the Mexican State.

In the old PRI era the country underwent daily mobilizations of this nature, but the system enjoyed the capacity, and generally the disposition, to act and to avoid reaching extreme situations. Although it was rare for a problem to be solved, at least it was equally rare for conflicts to reach unmanageable excesses. The gradual deterioration of governmental authority, the unwillingness to employ force and the mislaying of the compass ended up converting the government itself into the prey of blackmailers.  The generalized disorder that followed was the product of apathy: the old authoritarian rules were no longer applied due to fear of consequences in the media and a novel political concept to attack the heart of the problem was not developed. The two PANist governments changed neither the logic nor the tendency. Thus their debt to the society is so great: contrary to their historical buildup, they abandoned the citizenry and exerted no effort other than continuing to pave the road to perdition.

In the face of this reality, the new government has responded in two ways: it has reorganized the structures of real power in order to recover the misplaced authority and, as occurred on the Acapulco highway, has taken action to submit the troublemakers to minimal rules of civility. This concerns two sides of the same coin: to be the authority and to exercise it before anyone who challenges it. The immediate result has moreover been commendable. The government achieved attenuating the immediate matter: however, as can be seen daily, that does not constitute a solution to the underlying theme.

Blackmail only ends when the source of the extortion is eliminated or when his/its motive is resolved. In the youthful years of the old system the former was carried out but later nothing else was done: the blackmailers were not eliminated nor were the causes of the problem attacked, which gave rise to the proliferation of blackmailers. The exercise of the authority attacks the front line but nothing else. The question is what can actually be done.

The following quotation captures the essence of the problem and, because it has nothing to do with Mexico, it seems to me that it allows one to take a less caustic and more dispassionate perspective of the nature of our challenge: “The tragedy of al Assad family rule is Syria is not that it produced tyranny”, says Robert Kaplan. “That tyranny, remember, produced sustained domestic peace after 21 changes of government in the 24 years preceding the elder el Assad’s coup… The tragedy is that the al Assads did nothing useful with the domestic peace they had established. They did not employ the order they had created to build a civil society, one that would have prevented the current war. They never converted their subjects into citizens: Citizens rise above sectarianism, whereas subjects have only sectarianism to fall back on”.

Recent events in the state of Guerrero show the worst of the old political system, together with the risks of dangerous alliances with organized crime. But the solution dwells on a political realignment with the will to employ force to make it stick. The Acapulco highway roadblock and the action by the group that is responsible and its leaders are nothing other than sectarian responses to a system with which they do not identify. They do not see that the system benefits them or that they can advance their legitimate interests via the negotiation route, because they are not, nor they feel themselves to be, citizens. They feel that they are subjects and, as such, they defy the government. The mechanism of blackmail worked very well for decades. But today the government is wrong if it thinks that it is going to dissuade them with a couple of shows of authority. What’s required is a change in the basic conception of what are the government and the citizenry. It will not be easy, but it’s the only way to break the impasse.

www.cidac.org

@lrubiof

Luis Rubio

The country continues to be divided, not only in positions and preferences but also in the concept of how Mexicans find themselves as a society. For some Mexicans blocking a highway is something natural and acceptable: all’s fair in love and war. For others the blocking of a means of communication constitutes a constitutional violation. For the former the use of force is tantamount to repression, thus reprehensible and should never take place; for others, force is a central instrument of the rule of law. This is about not only views at cross-purposes but also about radically different lifestyles: for some “the worse the better”, for others “we’re just getting along”. In the last analysis, the deep-seated issues that confront Mexican society are never confronted: the division that stupefies the country and that hinders it from constructing a platform of development in which we all dovetail. None of this is new, but the terrible thing about it is that for fifty years Mexicans have been, at least since 1968, entangled in this labyrinth and there’s nothing to suggest that we have advanced even an iota.

It’s easy to assign blame, insults or epithets in every direction, as has happened with the roadblocks organized by National Coordination of Education Workers (CNTE) zealots, but that won’t get us very far. To the extent that these groups live within an environment or a power rationale distinct from that of those who accept the formal rules of the game (be these wrong, wanting or insufficient), the rules are inapplicable. From this perspective, it’s worthless to condemn a behavior when the selfsame objective of an individual who behaves in a determined manner is to make the opposition or reprehension of the normative framework felt that “others” consider valid. The contradiction is what lies at the heart of the level of conflict that the country is undergoing (without including organized crime, another matter entirely) and due to which, for decades, there has been not even an attempt at response.

Worse yet, the existence of views, positions and strategies at cross-purposes has fostered the development of an entire industry of political manipulation –created and fostered from the government and then found uncontrollable-, much of which is inspired less by great philosophical principles or ideals than by the most mundane pragmatism, known in the dictionary as blackmail and extortion. That’s how Mexico City became the oasis of demonstrations or how, instead of seeking solutions to the core problematic, some unions have preyed upon, some presidential candidacies have been launched solely on the basis of resentment, or how some politicians have taken refuge behind ever higher walls: the official presidential residence Los Pinos is a good example of this.

The blackmail industry today includes everyone: from the governor who appears to demonstrate alone in front of the National Palace to those who commandeer conflict in the most remote nook and cranny of the country to Insurgentes Avenue, not to resolve the problems of the indigenous but rather to nudge along their own personal cause. Between one thing and another are secreted dissidents, negotiators and blackmailers. But the underlying point is not the blackmail industry but the fact that in effect there is an essential cleavage at the heart of the country and the Mexican State.

In the old PRI era the country underwent daily mobilizations of this nature, but the system enjoyed the capacity, and generally the disposition, to act and to avoid reaching extreme situations. Although it was rare for a problem to be solved, at least it was equally rare for conflicts to reach unmanageable excesses. The gradual deterioration of governmental authority, the unwillingness to employ force and the mislaying of the compass ended up converting the government itself into the prey of blackmailers.  The generalized disorder that followed was the product of apathy: the old authoritarian rules were no longer applied due to fear of consequences in the media and a novel political concept to attack the heart of the problem was not developed. The two PANist governments changed neither the logic nor the tendency. Thus their debt to the society is so great: contrary to their historical buildup, they abandoned the citizenry and exerted no effort other than continuing to pave the road to perdition.

In the face of this reality, the new government has responded in two ways: it has reorganized the structures of real power in order to recover the misplaced authority and, as occurred on the Acapulco highway, has taken action to submit the troublemakers to minimal rules of civility. This concerns two sides of the same coin: to be the authority and to exercise it before anyone who challenges it. The immediate result has moreover been commendable. The government achieved attenuating the immediate matter: however, as can be seen daily, that does not constitute a solution to the underlying theme.

Blackmail only ends when the source of the extortion is eliminated or when his/its motive is resolved. In the youthful years of the old system the former was carried out but later nothing else was done: the blackmailers were not eliminated nor were the causes of the problem attacked, which gave rise to the proliferation of blackmailers. The exercise of the authority attacks the front line but nothing else. The question is what can actually be done.

The following quotation captures the essence of the problem and, because it has nothing to do with Mexico, it seems to me that it allows one to take a less caustic and more dispassionate perspective of the nature of our challenge: “The tragedy of al Assad family rule is Syria is not that it produced tyranny”, says Robert Kaplan. “That tyranny, remember, produced sustained domestic peace after 21 changes of government in the 24 years preceding the elder el Assad’s coup… The tragedy is that the al Assads did nothing useful with the domestic peace they had established. They did not employ the order they had created to build a civil society, one that would have prevented the current war. They never converted their subjects into citizens: Citizens rise above sectarianism, whereas subjects have only sectarianism to fall back on”.

Recent events in the state of Guerrero show the worst of the old political system, together with the risks of dangerous alliances with organized crime. But the solution dwells on a political realignment with the will to employ force to make it stick. The Acapulco highway roadblock and the action by the group that is responsible and its leaders are nothing other than sectarian responses to a system with which they do not identify. They do not see that the system benefits them or that they can advance their legitimate interests via the negotiation route, because they are not, nor they feel themselves to be, citizens. They feel that they are subjects and, as such, they defy the government. The mechanism of blackmail worked very well for decades. But today the government is wrong if it thinks that it is going to dissuade them with a couple of shows of authority. What’s required is a change in the basic conception of what are the government and the citizenry. It will not be easy, but it’s the only way to break the impasse.

www.cidac.org

@lrubiof