On July the 8th, the Mexican president Andrés Manuel López Obrador (AMLO) flew to Washington to celebrate the official July 1 enactment of the revised North American Free Trade Agreement with the US President Donald Trump. The summit was a public relations event in which the two leaders showcased an unusual moderate narrative, and celebrated their good neighbour relations in an attempt to sweep below the carpet their record of political and economic failures
This meeting coincides with an important anniversary for the Mexican President, as June 2020 marks two years of the presidency of Andrés Manuel López Obrador (AMLO), the long term opposition leader who won the 2018 election by a historical landslide of votes. After two failed attempts to reach the majority in 2006 and 2012 elections, more than 30 million Mexicans - 53.2% of the voters - voted for AMLO’s coalition “Together We Will Make History,” hoping he would end rampant corruption, criminal violence and economic stagnation.
Over the past two years, AMLO’s administration has adopted radical changes aimed at modifying not only policies, but also the institutional equilibrium of the Mexican republic and the balance of power among social and economic forces in the country. These changes have not brought about the expected outcomes, as the country is headed toward a potentially double-digit recession, while facing a surge in criminal violence.
The security issue
AMLO’s security policy is based on the cessation of open confrontation with drug cartels in an attempt to revert the dramatic increase in murders that started in 2006 as a consequence of the “war on drugs” initiated by former president Felipe Calderón. Nonetheless, in 2019, Mexico registered over 35 thousand murders - an all-time record - whereas the figure for 2020 projects an increase by 2.4%. Also, femicides rose to 1.006, with a nearly 25% increase since AMLO took office in 2018. The crisis certainly precedes AMLO’s government. However, the increase in frequency and brutality of attacks by cartels indicates that AMLO’s security policy has failed, and that organised crime gained power, expanding their already wide margins of action and impunity.
During his many years as an opposition leader, AMLO was a harsh critic of the militarisation of public security operated by his predecessors and centered his political narrative on national pacification, summarised through his notorious slogan “hugs not bullets.” Nonetheless, against all expectations, AMLO has increased the power and competences of the militaries, as in February 2020 when he conferred the military with control over civil operations until 2024.
In addition, the president discarded the Federal Police - a 40 thousand-strong law enforcement agency, built at great expense during the three previous administrations - and replaced it with the newly created “National Guard,” which operates under military command. In the last two years, AMLO replaced most top civilian officers with generals and admirals in the National Guard - led by General Luis Rodríguez Bucio - as well as in the Secretary of National Defence - led by general General Luis Crecencio Sandoval - and the National Intelligence Agency - led by General Audomaro Martínez.
Police in Mexico are a long-standing problem. They are poorly trained and notoriously corrupt, with there being evidence of kidnappings and extrajudicial killings carried out by police officers. In addition, police are heavily under-funded - as 42% of them have to pay for their uniform, 25% for their ammunition, and 12% for their anti-bullet jacket - and under-paid - as in several states their salary is below 7.000 pesos (270 euro) per month.
The problem with AMLO’s approach on security is that it is wholly based on emergency measures. The army cannot stay in the streets forever, and at some point it will be necessary to re-establish a new normality. Reforming police, especially state and local police, is a hard task, as the federal constitution imposes limits to the interference of the federal government onto local security forces. However, there is no other way to normalise the situation other than increase efficiency and accountability of police forces.
Security policies alone cannot solve the problem of criminal violence, as no policy can bring fruits without an efficient justice system. In 31 out of 32 total states, the impunity rate is above 90%, whereas in the states of Tamaulipas and Veracruz this reaches 99.9% and 99.8% respectively. These figures are only partially due to corruption, as the system suffers chronic shortage of public prosecutors and forensic doctors.
Without any plan to normalise the situation through prudent administration of justice and security, the current administration risks going down in history as the most violent period in Mexico since the Revolution (1910-1920).
AMLO correctly contends that in order to defeat organised crime the government must focus on reducing the rampant social and economic marginalisation. Yet the disadvantage of policies to address social and economic marginalisation is that their effect would only be seen in the long term. In addition, the recent security measures adopted by the administration clash with the above mentioned intentions, as in September 2019 social programs have been reduced and their budgets slashed by 4.4%.
The economy
AMLO’s vision of social development is based on massive redistribution of wealth through large-scale direct cash transfers to low-income Mexicans. At the moment, given the current Covid-19 pandemic, this measure can be a palliative, but in the medium-term this approach will hardly tackle the causes of the structural inequality in the country - such as the exclusion from healthcare and education, and the lack of labour rights.
At the core of AMLO’s economic program there is the relaunch of the energy sector, namely the national state-owned petroleum company PEMEX, which would allow income revenues and cheap energy to foster growth. However, the insurgency of the energy crisis triggered by the Covid-19 pandemic has given a severe blow to the national oil sector, increasing PEMEX debt which was already above $100 billion dollars at the beginning of 2020.
PEMEX was a risky bet, given its decades-long record of inefficiency and corruption. To avoid bankruptcy and privatization, AMLO’s administration supported the company with a rescue package of 5 billion dollars in 2019. Nonetheless, in 2019 PEMEX reported a 92% increase in debt, leading Fitch and Moody’s to downgrade the company’s debt to junk bonds status in April 2020. PEMEX is a massive cost for the public budget and it is unlikely that the company will ever return to be the engine of the national economy as it was in the seventies.
Not only has AMLO’s administration obstinately defended the national oil sector, but it also tried to halt renewable energy projects. In April 2020 the National Center for Energy Control (CENACE) suspended 17 renewable energy plants. This decision will hardly benefit the national hydrocarbon sector, but had the immediate effect of further alienating foreign investors. Noticeably, in the last months Mexico lost ground in several international rankings measuring FDI attractiveness.
AMLO’s institutional and economic experiment seems doomed. Without effective law enforcement, economic growth and foreign investment, socio-economic marginalisation can only increase, leaving even more space for organised crime to prosper and challenge state institutions. As AMLO has expressed no intention to change his policies, there is very little chance that in the next four years of his presidential term Mexico will see any improvement.
The problem, at this point, is that Mexicans have no alternative. AMLO was the alternative, but he proved himself incapable of delivering results. At the moment, the only viable option is a u-turn back to the previous crony, corrupt and inefficient system implemented by PRI (Partido Revolucionario Institucional) and PAN (Partido de Acción Nacional), whose results were at least better than those of this administration.
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