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Dearth of a sales job

31 January 2009

The Foreign Policy Association Blog reported that at least six senior Mexican officials (President Calderon, Finance Minister Carstens, Foreign Minister Espinosa, Energy Minister Kessel, Communications and Transport Minister Téllez and the President of the Banco de Mexico, Guillermo Ortiz) all went to Davos this year.  A commentator noted that it costs $40,000 (U.S.) per person to attend this event, and the “top guns” of course brought their aides and assorted minions.  Since we Mexican taxpayers are footing the tab for what’s basically a convention for the international banking biz, it might be nice to know what we’re getting for our investment.

Other than trying to counter the negative image Mexico has received in alarmist U.S. and other foreign media, the  Calderon Administration seems to be selling slightly shop-worn economic ideas.  Said Calderon:

“It’s of key importance for Mexico that it is known, precisely in this forum, what we have achieved in the country, the reforms that have been promoted by the Mexican Government and approved by the Mexican Congress, the progress we have made, the changes that have been made in the fiscal structure of the government on pensions and energy, so that it allows [us] to provide a more objective and clear overview of the economic transformation we are undertaking in the country,”

Just what these “economic transformations” include is questionable.  Here in Mexico, the Administration has been forced this week to make concessions to the left, freezing deisel prices in the face of popular discontent.

At the same time, and just as the world financial order has come crashing down due to unregulated markets in the United States, Guillermo Ortiz, the central bank president, is pleading for less state regulation and more “self-regulation” in the banking industry.  While at least one of Ortiz’ suggestions (that executive compensation be tied to long-term, not short-term returns on investments) makes perfect sense, he seems to be arguing that the very regulations which so far have cushioned the Mexican economy from the world-wide credit disaster need to be relaxed.

Laura Carlsen, in a perceptive article on the 2007 Davos Conference, wrote of Calderon:

In Davos, Calderón presented a series of facile dichotomies: past and future; democracy or “dictatorial regimes”; free markets or closed economies. By doing so, he caricatured Latin American politics today, ridiculed many of its leaders, and dismissed the views of the millions of Mexicans who voted against him and for a very different economic project.

The opposition to the PAN candidate grew out of a deep disenchantment with the economic model. Much of Mexico’s population, especially its poorest and most vulnerable sectors, believes it is not represented by the Calderón government. But instead of attempts at reconciliation, in Davos the new president reaffirmed his commitment to ensure that Mexico remains a poster child for the status quo. By carrying an ideological platform of economic orthodoxy into the international arena,Calderón rubbed salt in wounds still fresh from the post-electoral conflict.

Although there have been some important changes since 2007 — notable the new tax code and changes in the PEMEX management structure — most of these were only achieved by jettisoning the radical “free market” orthodoxies originally proposed by the Administration in return for Congressional support by the left. Things have not changed all that much. What’s different this year is that, having bought into the Merida Plan anti-narcotics funding, and pursuing a what’s perceived abroad as a “war” and a “failed state” — the “powers that be” have to resell the same product all over again.

One Comment leave one →
  1. el_longhorn permalink
    2 February 2009 1:09 pm

    The Mexican left has definitely forced Calderon to compromise, and improved policy as a result. props to them. Is it just me, or is Calderon in the midst of a quiet funk right now? Maybe it is just that I am obsessed with Texas politics right now, but I have not heard or seen anything significant coming from Calderon for a while.

    I’m translating an article by Ricardo Pascoe, who was a lefty turned Fox supporter (Ambassador to Cuba) and served in Calderon’s transition team. Pascoe sees Calderon as another George W. Bush, turning from a “national security crisis” to irrelevant social issues for party reasons.

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