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Bloomberg Businessweek
May 14, 2018
Obrador and his pick for inance minister, Carlos Urzua, how-
ever, have pledged to reduce the budget deicit, to respect the
autonomy of the central bank, and to keep the peso loating
freely. The savings they’ll reap from eliminating corruption
and graft, they say, will keep the government lush. “We are
more centrist than Lula,” says Urzua, referring to Brazil’s for-
mer president Luiz Inácio Lula da Silva, another leftist who
campaigned on social reform and who ultimately surprised
investors with business-friendly policies.
Not everyone buys the sales pitch, of course. Citigroup Inc.’s
Mexico economist Sergio Luna recently warned clients that
López Obrador would “eventually generate macroeconomic
inconsistencies in terms of monetary, iscal, and commercial
policy.” He sees inlation rising and the deicit widening.
It doesn’t help that the candidate himself often contradicts
the same advisers who defend him as a iscal pragmatist who
won’t do anything drastic. At a February rally in Puebla state,
López Obrador vowed to his supporters that he would never
allow Mexican crude to return to the hands of foreigners—
after his advisers had said he would never try to nationalize
the oil industry. At another rally he vowed to end
gasolinazos
,
or surges in gasoline prices, by freezing prices in real terms—
though his team later insisted that what he really meant was
that he’d cut fuel taxes. More recently he said he may seek to
reform the oil industry in the second half of his administration.
The current administration of Enrique Peña Nieto instituted
free-market reforms to the energy and iscal sectors under a
plan called the Pacto por México. Over time, they’ve proved
deeply unpopular, as has the president, who’s been saddled
with approval ratings as low as 12 percent. Corruption scan-
dals hastened his fall from grace.
The higher López Obrador rises in the polls, the more will-
ing he seems to drop all pretense of appeasing business lead-
ers. Within the larger context of Mexico’s problems—spiraling
violence, rampant corruption, endemic poverty—their anxiet-
ies can seem beside the point, and Monterrey begins to look
like a tiny island in a very big sea.
The first of three planned presidential debates was held in late
April, and the evening’s broadly stated theme—governance and
politics—quickly narrowed to focus on Mexico’s two most press-
ing preoccupations: violence and the impunity that almost
always accompanies it.
Last year was the deadliest in Mexico’s history, with almost
30,000 murders. This year things are even worse, with homi-
cides jumping 20 percent in the irst three months. Turf bat-
tles among the drug cartels rage across the country, and daily
news reports are dense with assassinations and dismember-
ments. In contrast to the U.S., where about two-thirds of homi-
cides result in arrests and indictments, about 95 percent of all
crimes in Mexico—and more than 98 percent of homicides—
remain unsolved.
One of the ive presidential candidates, Jaime Rodríguez, the
independent governor of Nuevo León, suggested he’d combat
crime and corruption by cutting of the hands of thieves. When
a debate moderator asked if he was speaking iguratively, he
assured her he was not.
López Obrador’s own proposal of amnesty for certain crim-
inals as an attempt to start a dialogue and stop the cycles of
violence—an idea that previously had been pounced upon by
some of his critics as irresponsibly unhinged—seemed relatively
conventional. A political truism seemed to be emerging from
all of this: When important governmental institutions are so
comprehensively broken, the politics of continuity becomes
untenable, and the extremes are pulled into the center. How
could a candidate be criticized as too radical if radical change
is desperately needed?
López Obrador’s closest competitor in the race is Ricardo
Anaya, who represents a coalition of parties and generally
casts himself as pro-business. The PRI’s Jose Antonio Meade
has struggled to distance himself from Peña Nieto and is run-
ning a distant third. Rodriguez and Margarita Zavala, the wife
of former President Calderón, round out the ballot. As the most
vocal proponent of comprehensive change in the race, López
Obrador seemed both galvanized and relaxed at this debate.
In 2006 he infamously told incumbent President Vicente Fox
at a campaign event to “¡
Cállate, chachalaca
!” (“Shut up, you
noisy bird!”). Now he appeared subdued, even withdrawn. At
one point he marveled at his lead in the polls and suggested
there was almost no way he could lose.
“Something terrible would have to happen,” he said.
A week later he returned to Monterrey to attend a forum at
the Monterrey Institute of Technology and Higher Education.
Known as Tec, it’s generally considered the best business
school in Latin America. Tec is the alma mater of many of
López Obrador’s adversaries within the country’s business
elite. Figuratively, and in some cases literally, he had come to
speak to their children.
About 1,800 students packed into an auditorium, where
López Obrador relaxed in an armchair, serenely answering
dozens of questions about everything: the death penalty (he
opposes it), euthanasia (he supports it), the idea of pensions
for former presidents (he’ll abolish it), gender equality (he’ll
respect it). When he dropped a casual reference to how the
powers that be unfairly thwarted his irst presidential run, he
was rewarded with applause. A former student named Manuel
Toledo took to Twitter after the event and observed, “As an
alumnus of this institution, I must admit that I never in my life
expected to hear the students of Tec de Monterrey applaud
AMLO after he stated (with customary pride) about 2006, ‘With
all due respect, they stole the presidency.’”
The millions who dwell in Mexico’s impoverished country-
side remain his ever-reliable base, the ones he’ll always be able
to connect to with an unafected ease. But it’s the residents of
Mexico’s north, in cities such as Monterrey, who will deter-
mine whether this year is diferent for him from 2006 or 2012.
When he concluded his remarks, López Obrador waved
to the students and slipped a Tec jersey over his shirt and
tie. He exited the stage to chants of “
Presidente, presidente,
presidente!
”