Mexican Congress attacks grocery coupons


Here’s a link to my most recent article on AQBlog, titled “Mexican Congress attacks grocery coupons”
Date published: Jan 21st, 2011 I hope you find it interesting. Please feel free to comment.

Here’s a copy of it:


In Mexico, most medium-size and large companies provide their employees vales de despensa, or grocery coupons, as part of their monthly benefits to workers. These were originally instituted to provide tax breaks to both businesses and individuals. The value of grocery coupons is not declared as part of one’s personal income (so it is not taxed) but in most cases, it does account for a significant amount of money. Vales de despensa are an accepted form of currency in supermarkets, gas stations and even restaurants.

Now, this week, the Diario de la Federación (Official government gazette) announced that our Federal Congress published yet more proof of their nearsightedness by issuing a new law regulating the use of vales de despensa, the Ley de Ayuda Alimentaria para los Trabajadores. As part of its undeclared war on big business (proof of which is in every recent tax reform), Congress decided to restrict the use of vales de despensa and prohibit the purchase of alcohol and tobacco with this currency (Article 12, section II).

For people with a small cash flow, this inherently means that government is making it even harder for them to exercise their free will and purchase what they please in a grocery store.  Government already has a special tax for alcohol and tobacco, which came into effect on January 1, 2011, and forced price increases in these products (transfering the tax imposition directly to customers). In cigarettes for example, this new tax implied a 25 percent price increase from one day to the next.  It is self-explanatory that the intention is for government to try to squeeze the most it can from its captive tax contributors (as opposed to actually doing something about the other 90 percent of the people who evade taxes and/or are part of the informal economy).

The “healthy diet” excuse does not hold ground, at least in the case of alcohol. Countless studies (here’s one) from international scientists have proven time and time again that in moderation, alcohol can actually make your heart stronger and improve your memory.  Obesity, caused by lack of exercise and the ingestion of junk food, and not alcohol, is Mexico’s top health concern today. If Congress wanted to be logical about it, they would have taxed certain food products including maize and corn tortillas (which by the way are part of our subsidized foods). A better physical education program in public schools would also do a lot more in favor of combating obesity than further restricting the purchase of a bottle of red wine.

More importantly, the constraint imposed on vales de despensa is an infringement on our right to exercise free will. Every worker earns the money deposited in these coupons. It is part of their pay for a hard day’s work and government should not have the power to tell them what they can and can’t spend it on.

I am not a smoker and I hate the smell of tobacco, but as long as cigarettes are a legal substance for adult consumption, I have to respect the right of someone to purchase a pack of their favorite brand using their own money. And the government should do so as well.

*Arjan Shahani is a contributing blogger to He lives in Monterrey, Mexico, and is an MBA graduate from Thunderbird University and Tecnológico de Monterrey and a member of the International Advisory Board of Global Majority—an international non-profit organization dedicated to the promotion of non-violent conflict resolution.

The United States’ Limited View of the War on Drugs


Here’s a link to my AQBlog article “The United States’ Limited View of the War on Drugs”, published on April 6th, 2010.

Here is a copy of it:


It took the deaths of two American citizens and the husband of a diplomatic employee—all tied to the U.S. Consulate inCiudad Juarez—for the Obama administration to apparently take notice ofMexico’s drug problem. Still, it seems that even the rhetoric fromWashington will limit itself as much as it can to address this crisis as long as the bloodshed continues to hit outside ofU.S. national borders.

On March 14all the headlines focused on the targeting of U.S. Consulate employees in the border town ofCiudad Juarez, which has become one of the main stages for drug-related violence in the recent years. Secretary of State Hillary Rodham Clinton was quick to respond to these attacks in an unusual address on a topic that had been left off the agenda until recently.

It seems that as long as the victims of drug-related violence did not carry U.S.passports, the Obama administration only cared enough to issue petty warnings to American tourists not to visit our country. Yet when Enriquez, Redelffs and Salcido were gunned down President Barack Obama told the world he was outraged and promised a quick response to the issue. Clinton said that “this is a responsibility we must shoulder together” and subsequently made an official visit toMexico 10 days later. There, she met with key officials in Calderón’s administration to work on a joint solution to the problem.

The promise of a shoulder-to-shoulder collaboration on (in this blogger’s view at least) a problem generally created by the most profitable market for the drug trade filledMexico’s hopes. But we were reminded of former Mexican President Porfirio Díaz’ famous quote “Poor Mexico! So far from God, so close to theUnited States.”Clinton’s visit toMexicoturned out to be yet another example of quick and shallow politics to diffuse a media situation, instead of addressing the real problem head-on.

Reminding us of the $1.4 billion investment the U.S. is making over three years in “a thus-far unsuccessful effort to crush cartels who ship $40 billion worth of illegal drugs north each year” Clinton came to Mexico to accept part of the blame of this problem by saying that the U.S. should crack down on gun control. “These criminals are outgunning law enforcement officials […] And since we know that the vast majority, 90 percent of that [weaponry] comes from our country, we’re going to try to stop it from getting there in the first place,” Clinton said. As always, the question ofU.S. consumption was marginally addressed and no specific strategy to decrease it was put on the table.

In a recent interview with CNN’s Fareed Zakaria, President Calderón said that as long as the largest market for these illicit products is not willing to discuss alternative solutions (such as legalization), debate over these strategies in source countries is futile. Both Calderón and Porfirio Díaz’ words hit right on target.

As long as the Obama administration continues to look at the problems brewing south of theU.S.border as something of marginal importance—deeming his attention only when cares enough to cover the death of Americans—Mexicois left alone to deal with this growing hot topic. $1.4 billion and a promise on gun control are just not going to cut it.

*Arjan Shahani is a contributing blogger to He lives in Monterrey, Mexico, and is an MBA graduate from Thunderbird University and Tecnológico de Monterrey and a member of the International Advisory Board of Global Majority—an international non-profit organization dedicated to the promotion of non-violent conflict resolution.