Discussion: (0 comments)
There are no comments available.
A public policy blog from AEI
More options: Share,
Last week, Mexican President Andrés Manuel López Obrador (AMLO) marked his 100th day in office. Despite sky-high approval ratings — between 67 percent and 86 percent depending upon the poll — AMLO has displayed a greater proclivity to destroy and undo than he has to govern Mexico. While he understands what makes for good politics, his understanding of good policy is an open question.
AMLO began by scrapping a half-built, $13 billion airport — the largest infrastructure project in the country’s history — to relieve congestion in Mexico City. The new Congress took office in September of last year, and his party’s majority allowed AMLO to impact policy before his inauguration. He deployed the public consultations process to gauge the public’s support for the airport project; however, instead of using the country’s electoral institute, AMLO relied on polling booths run by his party and placed in strategic strongholds around Mexico City — hardly a recipe for an unbiased view of the project. In the end, servicing the debt already incurred and cancelling all of the contracts awarded may be more expensive than bringing the airport construction to completion.
AMLO has also embarked on other, similarly unsound economic policies. PEMEX, the world’s most indebted state oil company, is in dire need of reform. AMLO gave $5.2 billion in tax breaks and capital injections to the company, but suspended bidding rounds for plots of land and prohibited joint ventures with multi-national firms. Sovereignty requires that foreign companies have a limited role in Mexico’s energy production, he said. To revitalize the company, AMLO appointed an agronomist with no experience in energy markets. It comes as no surprise, therefore, that the ratings agencies downgraded their outlook for PEMEX. (AMLO responded by slamming the ratings agencies and refusing to accept their analysis, while members of his party suggested banning them if they were not “objective.”)
In one of the world’s most violent countries, security reform and anticorruption efforts have also occupied AMLO’s time. He badly botched the rollout of a plan to fight endemic oil theft, leading to massive lines and widespread shortages. No more than a week after initiation, a pipeline explosion resulted in the deaths of nearly 100 people. His reliance upon the military for enforcement of anticorruption efforts demonstrates that he does not understand how thoroughly organized crime has penetrated the army’s ranks, or worse yet, that he lacks the patience and long-term vision to build institutions for effectively curtailing corruption.
His other notable accomplishment, passage of legislation creating a National Guard to fight Mexico’s powerful drug cartels, not only signals a militarized approach, but a re-branding of the same mix of toxic ingredients. Despite campaigning to end the drug wars and switch to a more “humane approach” to the trafficking problem — one of his campaign slogans was “yes to scholarships, no to hitmen” — AMLO pushed for legislation creating a National Guard comprised of current members of the National Police and the Mexican Army. In the end, the armed forces will gain the legal framework for law enforcement operations they have long sought, while AMLO will retain the support of this important institution. Prospects for security sector reform and a novel strategy for fighting organized crime, however, remain dim.
Most surprisingly, the clash many predicted between AMLO and Trump has not transpired. AMLO has been reserved in the face of insults and pulled back on his offer to push for humanitarian visas for the family of notorious drug lord “El Chapo” Guzmán. Yet, AMLO’s lack of interest in foreign policy will soon be tested by the upcoming necessity to approve the USMCA trade deal and an increasingly tense standoff on the border over Central American migrants. Sooner than expected, AMLO may find that he cannot ignore Trump any longer.
There are no comments available.
1789 Massachusetts Avenue, NW, Washington, DC 20036
© 2019 American Enterprise Institute