Return of the Divider: López Obrador Kicks Off Again

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Here is a link to my latest article on AQBlog, titled “Return of the Divider: López Obrador Kicks Off Again”

http://americasquarterly.org/node/2403 , published on April 20th, 2011. Please feel free to visit and comment.

Here’s a copy of it:

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Andrés Manuel López Obrador (AMLO) refused to accept defeat in the 2006 Mexican presidential race, causing chaos, dividing our citizenry with messages of hate and tolerating violence from his supporters. But it seems Mexico is ready to give him another try at the top seat of government.

When he ran in 2006, López Obrador was able to rally together practically all leftist factions and political parties. However, the election aftermath and López Obrador’s shift toward extremism caused many of his supporters to abandon him and to look for a more rational social discourse.  López Obrador’s current inability to maintain consensus even within his own political party is one of the main reasons why today the Partido de la Revolución Democrática (PRD) is a weakened organization and keeps juggling with on-and-off alliances with its offspring (Partido del Trabajo, Convergencia, Partido Social Demócrata, and other small political parties).

Since the PRD would not institutionally carry him, López Obrador recently created a new platform, called the Movimiento de Regeneración Nacional (National Regeneration Movement), or Morena for short, which coincidentally translates to “dark-skinned woman” and is a reference to the Virgen de Guadalupe (Virgen Morena). Through Morena, López Obrador is once again appealing to the disheartened lower classes and sowing seeds of division with over-simplified, anti-business messages.

Though it is certainly true that in Mexico a huge gap between rich and poor continues to exist, it is a distortion of reality to wholly blame the private sector. For one, the government is not broke, nor does it lack the resources to spearhead development initiatives. For another, it significantly taxes the private sector. Money is there, but political will is absent.

Here’s the truth: In select industries, the Mexican private sector is taxed at a rate of up to 50 percent of its income. Yet business groups are arguably the largest promoters of development today, not just through creation of formal employment but through partnerships in large infrastructure projects, as well as promoting education and establishing corporate social responsibility programs (often more efficiently managed than most municipal budgets). Private enterprise is also one of the few captive taxpayers in a country where the informal sector amounts to approximately 25 percent of our economically active population and many government officials get automatic tax exemptions.

So what is Morena telling Mexico? Through its website, the party is accusing 16 Mexican businessmen of being personally responsible for what it calls “the national tragedy.” Among the named culprits are Ricardo Salinas Pliego from Grupo Salinas, Dionisio Garza Medina from Grupo Alfa, Emilio Azcárraga Jean from Televisa, Grupo BIMBO CEO Lorenzo Servitje, FEMSA President José Antonio Fernández Carbajal, Cemex CEO Lorenzo Zambrano, and Carlos Slim Helú, who heads Grupo Carso. 

Andrés Manuel López Obrador purports to offer “proof of responsibility” for this supposed tragedy by listing the approximate monetary values of the companies led by these men. Let me say that again: AMLO’s proof of these men’s participation in what he calls the national tragedy is the fact that they are able to run companies successfully and collectively provide employment to more than half a million people directly. Of course, López Obrador fails to mention the companies’ contributions to the economy and urban development, the benefits they provide their workers and their efforts to positively engage communities.

Morena’s hymn sings, “The Right must not alter the results of the elections. In order to avoid their frauds all we need is to organize against them.” It goes on to say “National Regeneration Movement: peaceful until the end.” But in Morena’s homepage we see an endorsement of the Sindicato Mexicano de Electricistas, an electrical workers’ union that has perpetuated violent conflict in Mexico City, including recently setting cars on fire, sabotaging the city’s electrical infrastructure and beating up Comisión Federal de Electricidad employees who took their jobs after Luz y Fuerza del Centro was dissolved.

At a time when what we need most is unity behind a constructive nation-state project, the return of the divider is a hard blow for our future and an irony of our political present.

*Arjan Shahani is a contributing blogger to AQ Online. 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.

Can anyone live on minimum wage in Mexico?

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Here’s a link to my AQBlog article “Can anyone live on minimum wage in Mexico?”, published on August 30th, 2010
http://www.americasquarterly.org/node/1798

Here’s a copy of it:

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In a quaint coffee shop in the heart of La Condesa  (one of Mexico City’s trendiest neighborhoods), Ana and Ricardo sit down and take a break from their jobs. One of them orders a shot of espresso, the other a soft drink and a muffin. Their bill exceeds 120 pesos ($9.10), excluding tip. After a while, they get up, pay and happily go on their way. 

One block from the café another Mexican, Silvia, mops the floor of a local supermarket and earns minimum wage. A single mother of two she has to make ends meet with 345 pesos ($26.20) a week working six days.

Her story is not an exception.  It is a reality shared by 12 percent of this country’s economically active population.  Another nine percent of our workers earn the sum of two minimum wages, 115 pesos ($8.74) daily.  This creates problems and challenges far greater than what these figures reflect.

In the U.S., the minimum wage is set at $7.25 per hour. At 13 pesos to the dollar and an 8-hour workday, this means that a minimum wage employee in the US earns 13 times as much as one in Mexico. Does this tell you a little bit about the risks migrants are willing to face in order to illegally cross the border?

Politicians in Mexico love to relate purchasing power to the price of the tortilla. At current rates, one minimum wage is the equivalent of 6 kilos of tortilla per day. This sounds like a lot (this is why they love to use this figure). I guess politicians expect us to live off of tortillas (and people wonder why our country has one of the worst obesity problems in the world). Unfortunately, though tortillas are cheap, nothing else on the shelf is. If Silvia pays a really low rent, she will blow the rest of her income when she goes to the  supermarket once a week and buys a box of cereal, a carton of milk, a couple of cans of food and a 2 liter bottle of her soft drink of choice. Not nearly enough to feed a family, let alone provide a balanced diet… Wait, don’t forget your tortillas!

The problem does not stop with migration or obesity.   On average, a corner drug pusher in Mexico earns 8,000 pesos ($608) a month. That’s almost six times as much as Silvia. Oh yeah, he doesn’t pay taxes either and works about half of the hours.  He also gets to carry a gun and earn the respect (or fear) of his peers. Schoolchildren in his neighborhood look up to him in ways that will never compare to a person whose work tools are a mop and a bucket.

Now, we tend to think that what will break the poverty cycle is access to higher quality education. Well, let’s look at the costs and aim for the highest quality we can find in the country. In Mexico that would be Tecnológico de Monterrey. At a university level, this institution currently hosts almost 50,000 students nationwide (on more than 30 campuses).  Tuition costs average 72,000 pesos ($5,470) per semester.  If Silvia wanted to put one her kids through this university, she would have to find a way to fully evade taxes and for her and her children to survive without food or shelter. She would also have to work 70 hours a day. 

Following a correct path, if he’s lucky Silvia’s son will have access to a low quality public high school. If he’s really lucky, he will graduate from a public university and maybe start earning  5,000 pesos ($380) per month. Selling marijuana to rich kids is a likelier (and more profitable) career path for him.  Maybe he will turn to stealing, kidnapping or extortion. And can you really blame him for resenting Ana, who nearly spent his mom’s daily income on a muffin?

Without a doubt, high quality education is the key to open many doors. The good news is that Tecnológico de Monterrey and other private institutions are exploring ways to make education more accessible. The bad news is they are not doing it nearly fast or creatively enough.

In the meantime, a revision of this critical figure and the way it is calculated is long overdue. We can no longer determine minimum wage levels based solely on the price of basic goods without taking into account the context we live in and the society we are trying to build. There is a lot more at stake stemming from this than a package of hot tortillas.