Recent events elsewhere in Latin America--specifically, an acute political crisis in Venezuela and a groundbreaking election in Brazil--have pushed Mexico off the front pages of American newspapers. Nonetheless, it is worth remembering that Mexico, our closest and most important Latin neighbor, is a major customer for our products and the source of many essential imports, most notably oil and gas. It is also a country with which we have intense cultural and human relations, far more indeed than most Americans realize. Its progress toward becoming an open and more modern society therefore deserves far more attention.

President Vicente Fox is nearing the midpoint of a six-year presidential term. The next major marker will be elections in July concerning all the seats in the lower national legislative chamber, all the governorships, and the legislative assemblies in eleven of Mexico's thirty-two states.[i] These elections inevitably will be interpreted in part as a referendum on Fox's administration--the first drawn from an opposition party in more than seven decades. At the same time, they will tell us to what degree the ousted Institutional Revolutionary Party (PRI) has managed to reinvent itself and become nationally competitive in a more pluralistic and open environment.

Economic Realities

First, however, the big picture. Mexico's recent economic performance has not been brilliant. Its gross domestic product grew by only 1.1 percent in 2002, though it will probably reach 3 percent this year--a figure which, by Latin American standards, is not to be disdained, save for the fact that Mexican expectations, both for Fox and for the results of a free trade agreement with the United States, have far outrun the actual numbers. Now, more than ever, Mexico's economy is closely tied to that of the United States, which takes nearly 90 percent of its exports (20 percent of the country's total output). As a result, Mexicans, no less than Americans, are pinning their hopes for the future on a revived U.S. economy.

A U.S. recovery is only one of two conditions to be met, however. Fox came to office pledged to enact far-reaching economic reforms to make the economy more competitive and to put more Mexicans to work. Lacking a majority in Congress, however, his plans have remained a dead letter, which explains why so many members of his party are counting on the July elections to break the logjam. Until and unless that happens, little can be done to jump-start Mexico's domestic growth. Among other things, the country needs to slash miles of red tape, overhaul excessively rigid labor laws, and allow more private investment in the energy sector (particularly electricity)--not to mention crack down on growing crime in Mexico City and other urban centers.

The slowdown in Mexico's growth has also led to rising criticisms of the free trade agreement with the United States. The phased elimination of tariffs on agricultural imports from north of the border has aroused anger and resentment in Mexico's agrarian sector, which is far less efficient than its American counterpart. The popular Mexican political magazine ¡Siempre! recently ran a cover in which a cartoonist depicted a vicious Uncle Sam, complete in his traditional uniform and star-spangled top hat, literally wringing out a Mexican peasant. Angry farmers have held demonstrations--complete with horses and tractors parading down the ample Paseo de la Reforma in the capital--which have prompted only hesitant steps by the government, the most recent of which was to raise some tariffs on imported chickens.

This last measure is a stop-gap that is unlikely to resolve basic problems. For ten years Mexicans knew that their poultry industry would have to compete with its far more efficient U.S. counterpart. During that decade nothing was done to make the necessary structural changes. A somewhat similar problem is bound to arise in 2005, when duties on sugar will disappear on both sides of the border. The Mexican industry has been restructuring in fits and starts to prepare to enter the huge U.S. market that will presumably be open to it a mere two years down the road. If, however, it fails to accelerate the pace of reform, all the advantages will run in the other direction. Can Mexico opt out of NAFTA product-by-product? That question is all the more pressing now that Central America is preparing to enter the accord with many of the same exports.

Immigration: The Eternal Issue

On another critical front--immigration--Fox has made little progress, largely because of events beyond his control. The importance of this issue for Mexico cannot be exaggerated. Between ten and twelve million Mexicans reside in the United States, legally and illegally. They send home an estimated $11 billion in remittances each year ($2.5 billion from the state of Texas alone), often to families in rural areas. Those payments represent an invisible safety net that no Mexican government is in a position to provide. Moreover, the existence of the United States as an escape valve, so to speak, prevents unemployment from becoming a politically explosive issue. Immigration also underwrites to a significant degree the country's vaunted political stability, and therefore could be argued to make a contribution to the national security of the United States.

Fox's original proposal on taking office was to essentially alter the nature of the free trade agreement to allow the complete and unhindered movement of Mexican nationals to the United States. In effect, his proposal called for open borders, establishing the same sort of labor arrangements that now exist in the European Union. Whatever the normal political obstacles such an idea might encounter, they obviously multiplied after September 11, 2001. As things stand now, border security has become a matter of the highest U.S. national interest, with both Mexico and Canada now seen as "soft" frontiers that require enhanced surveillance. Mexican officials recognize the new reality and are now taking their case out of Washington to states and communities around the country, where they are emphasizing the positive benefits of "orderly and legal" flow of Mexican workers to the United States, where many do indeed make valuable contributions.[ii]

The Political Scene

How are these issues playing out in Mexican politics? In the first place, the PRI, though ousted from the presidential palace, still has a majority in both houses of Congress and has not been slow to deploy it--not only to bury Fox's proposals, but also to criticize and complain. A vast uproar rose in both chambers after September 11 when foreign minister Jorge Castañeda Jr. expressed what to many PRI members appeared to be excessive solidarity with the United States, and even more when, on his instructions, the country's delegation at the United Nations Human Rights Commission voted to condemn Cuba (even though the resolution in question was marshmallow-soft). Castañeda has since been replaced by Luis Ernesto Debrez, who is expected to operate at a lower (and less risky) pitch. Meanwhile, Fox's inability to sell his immigration plan to President George W. Bush, with whom he was advertised to have a special personal relationship dating back to the days when they were both state governors, has also detracted from his image as a man who can deliver.

On the other hand, the PRI is not positioned to automatically benefit from Fox's deficiencies, partly because most Mexicans identify it with corruption and unearned privilege. Allegations persist that some $170 million from the state oil company was fed through the oil workers' union to fund the PRI's presidential campaign in 2000. And the party's president, Roberto Madrazo, was elected to the governorship of Tabasco state in an election whose results were widely questioned. (He and his backers have also been credibly accused of ballot rigging in his accession to the party presidency.)

In addition, the PRI is still having to learn how to function in a genuinely competitive political environment. In the past the party was virtually run out of the hip pocket of whoever occupied the presidency in Mexico; the same individual was granted the virtual right to name his own successor. (As Mexicans used to joke, they always knew the results of their presidential elections before they were even held.) Not surprisingly, without a clear line of authority from the top, the party councils are struggling to reach consensus on vital issues. As a result, despite all of Fox's problems the PRI is still reportedly running between 5 to 10 percent behind the president's PAN party in generic polls.

To be sure, the PRI is still a force to be reckoned with in Mexican politics. In addition to both houses of Congress, it controls nineteen of thirty-two state governments, and many trade unions, farmers' groups, and other civic associations. Even now in many villages and small towns in Mexico the local PRI official is the man or woman to see if you want any favor from the government, whether it be a scholarship for a son or daughter, cement to lay a foundation for one's house, or transportation to a medical facility in a distant town. Fox's PAN party, originally based in northern Mexico, has yet to develop this sort of web of services, and it benefits largely from being the main alternative to the PRI.

People to Watch

Although the next presidential election is still more than three years away it is not too early to take note of two possible contenders. The first is Miguel Alemán Velasco, son of a popular Mexican president who governed from 1946 to 1952. A man of great sophistication and charm, Alemán Velasco was educated in France and formerly served as president of the country's largest television network, a company with whom he still maintains a relationship. He is the PRI governor of the state of Veracruz, one of Mexico's most important. In a recent interview with the Mexican press, he boasted of his achievements in cracking down on drug trafficking and building dozens of new schools (as well as providing special credits for teachers to buy their own homes). He also claims that the local garrison has no human rights problems, unlike the situation in some other states (some of which he was tactless enough to name). He brushed aside criticisms that he spends too much time away from Veracruz, travels on his own personal jet, and has homes in a number of places. For what it may be worth, Alemán Velasco insists that he does not want to be president. As he told interviewers, “I've been part of a presidential family, and had close relations with other presidents, and frankly, it isn't an aspiration of mine”--hardly a Shermanesque statement, at least in Mexican terms.[iii]

The other personality, Andrés Manuel López Obrador, is even more interesting. A native of Tabasco, López Obrador helped to lead a leftist breakaway from the PRI in 1988, founding Mexico's third force, the Democratic Revolutionary Party (PRD). Most of the leaders of the PRD are leftists who broke away from the PRI when Cuautémoc Cárdenas, then governor of Michoacán, was denied the party's nod for the presidency. (In many ways, the PRD was created as a personal vehicle for his subsequent presidential quests.) Like Alemán Velasco, Cárdenas is a presidential son; his father, General Lázaro Cárdenas (1934–1940) is famous for having nationalized the oil industry. But after his son's three failed attempts to become president as the PRD standard-bearer, the party faithful are looking for a newer face. In many ways López Obrador fills the bill. Two years ago, at age forty-eight, he was elected mayor of Mexico City, where his austerity and energy have made him a virtual cult figure around town.

In the past López Obrador had the reputation of being a leftist firebrand. For example, in 1996 he led a group of Tabascan peasants in blockading the state's sixty-four oil wells, both to protest environmental damage and PRI corruption, which he claims robbed him of the governorship in a doubtful election there. He has since moderated his style, and to some extent, his rhetoric. Like Venezuela's president Hugo Chávez, López Obrador claims to be opposed to "neoliberalism" and "globalization"; unlike Chávez, however, he is interested in electoral politics and the day-to-day business of governing. He seems to be good at both. Whether the PRD can pull ahead and become at least Mexico's second most important party remains to be seen. It has turned in a mediocre score in the last two presidential stakes, but this may be due to Cárdenas's lack of charisma and maladroitness as a candidate, rather than to some structural barrier confronting the party he created. It is significant that at this point no one can say who the PAN will run to succeed Fox. If the PRD can establish itself as the best "not-PRI" choice, it may yet win the presidency on that merit alone. With a candidate as attractive as López Obrador, the PRD may also wean away significant support from PRI and PAN voters (much as Fox-for all his business connections and supposed affinity for the United States as former head of Coca-Cola in Mexico-did by courting the intellectual left and Mexico's environmental movements).

The Pull of the Past

Mexico is a fascinating and elusive country. In spite of wars and revolutions, foreign investment and the Internet, not to mention constant exposure to the United States and the American way of life, in many respects it seems uniquely resistant to change. The revolution of 1910 is a case in point. On paper at least, it appears to have been a major upheaval, involving as it did the massive expropriation of land and factories, the movement of large numbers of peasants to the city, the nationalization of basic industries, and the creation of a whole new political class. Yet as study after study shows, many of the same families continue to play a prominent role in regime after regime. A case in point is Interior Secretary Santiago Creel, a relatively young member of Fox's cabinet, who is a descendant of an American family that settled in Mexico in the early nineteenth century and eventually became one of the largest landowners during the long regime of General Porfirio Díaz (1876–1910). A study by Díaz's great grandson published in Mexico a decade ago chronicles how, though forced into exile, the dictator's family and retainers managed to hold on to much of their property throughout the turbulent 1920s and eventually to form marital alliances with the new revolutionary elite.[iv]

Vicente Fox's election may indeed open Mexican politics to new perspectives and meaningful pluralism, rendering it truly competitive for the first time. It may also lead to the breakup of the calcified structures of the Mexican state, providing new opportunities for economic growth and diversification. But anyone who knows Mexican history would be hesitant to expect change to be that rapid or dramatic. The pull of the past is still very strong.