The Return of the PRI and its Implications for the Democracy in Mexico

Mexican Presidential election took place on July 1st. Only 12 years ago Mexican voters kicked out the Institutional Revolutionary Party (PRI), which had ruled for seven decades. Now, Mexico has voted the PRI back to office, although it was denied a majority in Congress.

Many Mexicans seem confused and the international community cannot fully understand why a controversial presidential candidate from a historically antidemocratic political party was elected. The primary question after the election seems to be whether Peña Nieto’s victory implies the return of authoritarianism and the old fashion politicians into power.

The conventional theories of Political Science can easily explain the return to power of a political party. After all, transitions from one party to another are a common and healthy practice in any given consolidated democracy. However, a glimpse into the guts of the PRI and its history, even after losing the presidency in 2000, will reveal its pragmatism and its resistance to renovation.

The PRI has not transformed radically mainly because both the political system and voters in Mexico are somehow stuck in the past. Mexicans politicians have not fully embraced democracy. In fact, the PRI never lost power completely: it kept control over most of the States and had the majority in Congress in more than one legislature.

Peña´s victory was primarily due to the incapability of the right wing party (PAN) to deliver, the contempt for the drug war led by President Felipe Calderón, and the unpopularity of the left wing party (PRD) and particularly of its presidential candidate, Andrés Manuel López Obrador, who had rejected the electoral result six years ago and taken the streets of Mexico City. Peña won not because he conveyed to people that he would deliver or because he truly inspired the nearly 20 million citizens that voted for him, but because there was no other better option.

Peña Nieto will arrive to Los Pinos in a very controversial way. His candidacy was supported by a powerful alliance with Televisa and TV Azteca, the two major broadcasting television networks in Mexico, and spent millions of dollars in advertising, even exceeding the limit established by law (332 million pesos or 25 million dollars), according to his adversaries. After the British newspaper, The Guardian, revealed information about his association with Televisa, there is little doubt that Peña used the TV to promote himself for several years, which violates the Mexican Constitution. Although there is not enough evidence to declare the election null, what clouded the election the most was the vote buying and coercion, practiced mainly by the PRI.

There are other factors that contributed to Peña’s victory. According to the World Bank, only 31 percent of Mexico’s population has access to the Internet, which is well below from peer Latin American countries such as Brazil (42 percent). Education in Mexico is widely controlled by the Teacher’s Union (SNTE), whose role has gone beyond the defense of teachers’ rights and has therefore negatively impacted the quality of education. Mexico ranks last in the list of OECD countries that have taken standardized tests like the report PISA.

In light of the recent social and democratic movements in North African and Middle East countries, some optimistic analysts argued that a massive democratic wave would extend to other regions in the world, including Latin America, and in particular Mexico, a country that had been cleverly ruled by a so-called “perfect dictatorship”. Many Mexicans would have also expected that the antidemocratic practices of the PRI had been marginalized and a profound social movement had taken place to strengthen the young democracy in Mexico. Nevertheless, the wide victory of Peña Nieto illustrates that the democracy in Mexico faces a challenge that requires the involvement of a variety of actors in society.

Indeed, recent international events show us the necessity to ensure democratic institutions and the inherent dangers of postponing it. In Taiwan, the Kuomitang –another authoritarian party–, was able to survive and was restored in power after this year’s election; Vladimir Putin’s return to presidency in Russia threatens democracy in a country that had dissolved the Communist Party 21 years ago; Honduras’ coup d’état in 2009 against Manuel Zelaya; In Paraguay, the Colorado Party, which ruled the country for 61 years, removed leftist Fernando Lugo from office in alliance with other parties; In Syria, the authoritarian government continues to suffocate a social movement and has killed hundreds of people. In summary, antidemocratic forces continue to exist in the world.

On the other hand, there are reasons to believe in Mexico’s ability to ensure democracy. I believe that the return of the PRI represents a challenge to the country’s young democracy but Mexico is capable to overcome it. Mexico is a crucial actor in today’s globalization and that involves benefits and also a great deal of responsibility. 

Mexico’s population has grown by 600 percent over the last century. Only another 10 countries have larger populations. If we add the 11 and half Mexican citizens that live in the U.S., the country’s total population would be around 123 million.

Despite a general perception of paralysis within society, the country’s gone through a 15 year-period of economic stability, a remarkable contrast from the financial crises it suffered every 6 years since 1976. As a result, the middle-class is growing bigger, poverty is decreasing, and even inequality has been reduced. In spite of a dramatic fall in GDP in 2009 –derived from the financial turmoil that began in the U.S.—at the end of 2010, Mexico’s GDP per capita was 13,900 dollars. Compared to the other two largest economies of the region, it was lower than Chile’s (15,400 dollars), but bigger than Brazil’s (10,800 dollars). In terms of inequality, according to data from UN’s ECLAC, Mexico reduced its Gini coefficient by more than 5 percent between 1999 and 2008, Brazil reduced it by 3 percent, and Chile by 1 percent.

Similarly, Mexico has made remarkable progress regarding political and electoral institutions. Today, the country has a true balance of power, there is more accountability, corruption has decreased, and an electoral fraud is almost impossible.

Mexicans also used social networks as a means to spur the interest of people in the election. A wide flow of information about the candidates circulated through Facebook, Twitter and YouTube, which complemented that from conventional media. Moreover, social networks are more and more balancing the biased information coming from the big television networks in Mexico.

Despite the progress made, Mexico still faces an enormous challenge ahead. Democracy in Mexico, unlike other countries in Latin America, was born in a peaceful way in 1997 when the PRI lost its majority in Congress for the first time in history. Yet, it’s been developing in a slow pace ever since. Little by little Mexicans are starting to become better citizens, more involved in public affairs, but it’s not enough yet.

It was quite remarkable the massive social participation in the presidential election, both turnout and volunteers who helped. In spite of torrential rain in the capital and the competing temptation of a European football final, 63 percent voted, almost five points up from 2006.

Mexicans are awakening and are more aware of their reality than ever before. Many young Mexicans have recently taken the streets to demand an end to corruption and to the excessive power of the elites. They demand more and better democratic institutions, and accountability from the government. They must seize this momentum to generate the mechanisms to balance a government that may be tempted to rely on corruption, authoritarianism, corporatism, and clientelismo. The will be tempted to do so, not because there are no democrats in the PRI, but as Murice Duverger stated in his Genetic Model, “a party’s organizational characteristics depend more upon its history, i.e. on how the party originated and how it consolidated than upon any other factor”.

As the youth led movement #yosoy132 show, Mexicans are increasingly exhausted of the unwillingness of politicians to deliver. Media in Mexico is controlled by a duopoly that has been undermining the right to impartial and accurate information. In order to exist, a democracy needs the participation of citizens, and in order for them to get involved, they need to be well informed. Indeed, the only way that Peña Nieto’s government will deliver is by increasing social pressure and awareness.

Mexicans need to understand the raw power of information. Most of politicians’ power derives from the fact that they hoard it. Once that information is made public, especially the government´s lack of results, much of this elite´s advantage disappears. As Supreme Court Justice Louis D. Brandeis once wrote, “Sunlight is said to be the best of disinfectants”.

Peña Nieto could have the incentives to build a coalition government with the citizens and the opposition parties. Mexican citizens must create those incentives. The world may come to witness a moment in which a country builds itself from the bottom, by creating citizens less dependent on the government, but more critic of it. This may in fact be unique in a region where states have the historical temptation to become bigger instead of smaller.

In a real democracy, defeats as well as victories do not last forever. Ultimately, we´ll see an enormous challenge for the Mexican society. Mexicans will have to decide whether they will make the government accountable for their actions or will simply sit down with their souls in their laps and watch another chapter of a well-known telenovela. It´s time to prove that the return of the PRI does not mean a time travel but could be a jump into the future. It´s time to show some intelligent patriotism and defend their young democracy. It´s time to show that Mexico is a better and greater country than the one in their minds. It´s time to wake up and become what Mexico can truly be: a great nation.

México en la Encrucijada

El primero de julio los mexicanos le dieron su voto mayoritario al candidato presidencial del PRI, Enrique Peña Nieto.  Sólo 12 años atrás los electores habían optado por la alternancia despúes de que el partido tricolor gobernara durante 71 años.  Muchos mexicanos fruncen el ceño y parecen no entender exáctamente qué sucedió el día de la elección o por qué está de regreso el PRI, un partido que por mucho tiempo se le ha considerado como enemigo público de la democracia.

Las teorias de ciencia política pueden explicar con naturalidad la vuelta de un viejo partido al poder. Después de todo, la alternancia es un fenómeno sano y recurrente en cualquier democracia consolidada en el mundo. Sin embargo, un vistazo a las prácticas históricas del PRI, aún habiendo perdido la presidencia de la república en las elecciones del 2000, darán cuenta de su pragmatismo obstinado y su resistencia a la renovación.

El PRI no se ha desprendido de su pasado porque ni la estructura política en México, ni sus ciudadanos lo han hecho. En realidad, el PRI nunca perdió del todo el poder: ha conservado la mayoría de las entidades federativas y durante los 12 años de alternancia tuvo mayoría en el Congreso en más de una legislatura.

Peña Nieto no ganó porque haya logrado construir un proyecto de nación con la ciudadanía o porque haya elaborado las propuestas más claras de gobierno, ni porque haya inspirado con su visión a los cerca de 20 millones de mexicanos que votaron por él. Se trata, en buena medida, de una victoria consumada a partir de un proceso de eliminación; por un rechazo generalizado al gobierno de derecha; y una desconfianza en la izquierda que no pudo superar el daño que a sí misma se hizo hace seis años, cuando López Obrador optó por ignorar el fallo de las instituciones y tomar las calles de la Ciudad de México.

El virtual presidente de México llegará a Los Pinos de una manera muy cuestionable. Peña Nieto fue un candidato construido con ayuda de una ponderosa alianza con Televisa y TV Azteca, la dos televisoras que acaparan la señal abierta de México y con el derroche de dinero en publicidad, incluso rebasando, según sus detractores, los topes fijados por la ley electoral en 332 millones de pesos. Después de las revelaciones de Jo Tuckman en el diario británico The Guardian, quedan pocas dudas de un acuerdo Televisa-Peña Nieto. Se trata, además, de una flagrante violación al artículo 134 constitucional, que prohíbe la propaganda personalizada. Si bien no hay pruebas que concluyan un fraude electoral, el hecho que enturbió más la elección presidencial fue la compra y coacción del voto, practicada principalmente por el PRI.

Otros indicadores pueden ayudar a explicar el resultado de la elección. De acuerdo con cifras del Banco Mundial, apenas el 31 por ciento de la población en México usa internet, por debajo de países latinoamericanos como Brasil (42 por ciento), lo que muestra el rezago digital del país. La educación en México está secuestrada por el SNTE, el cual ha ido más allá de la defensa de sus trabajadores para incidir negativamente en la calidad educativa. México ocupa el último lugar entre los países de la OCDE en cuanto al desempeño de sus estudiantes en pruebas internacionales como PISA. No es de sorprender, entonces, que un candidato como Peña Nieto haya ganado la elección. La forma en la que llega a la silla presidencial no es sino un reflejo del rezago educativo en este país.

A la luz de la lucha social que se dio en países de larga tradición autoritaria, con la consecuente caída de dictaduras en Africa del Norte y el Medio Oriente, muchos hubieran deseado la aparición de una ola demcorática que se propagaría a países de otras regiones del mundo, incluida América Latina y, en especial, México, un país que había sido sutilmente domado por una perfecta dictadura. Muchos hubieran esperado, además, que las viejas prácticas antidemocráticas del PRI se mantendrían marginadas para abrirle paso a algún movimiento social-demócrata de gran envergadura. El resultado de la elección presidencial del 1 de julio muestra, sin embargo, que la llama priísta hace mella en el presente mexicano y que, lejos de extinguirse, podría ganar fuerza y extenderse en los años por venir.

En efecto, recientes acontecimientos internacionales nos muestran el peligro latente que supone postergar el avance democrático. En Taiwán, el Kuomintang –otro partido autoritario–, fue capaz de sobrevivir y este año ganó la elección presidencial; el retorno de Vladimir Putin a la presidencia de Rusia, un país que disolvió al Partido Comunista hace 21 años, amenaza a su joven democracia; Honduras sufrió un golpe militar en 2009 contra Manuel Zelaya; en Paraguay, el Partido Colorado, que gobernó ese país de manera autoritaria e ininterrumpida por 61 años, acaba de lograr, con auxilio de otros partidos, la destitución del presidente de izquierda Fernando Lugo; En Siria, la fuerza autoritaria se ha robustecido y la sangre corre a raudales. En suma, la antidemocracia no ha dejado de dar la pelea en el mundo.

Por otro lado, hay señales alentadoras en favor de la democracia. Me niego a pensar que el retorno del PRI a la presidencia es una vuelta al México autoritario y antidemocrático de gran parte del siglo XX. México se ha subido al barco de la globalización y ello contrae beneficios y responsabilidades.

La población de México se ha multiplicado siete veces en un siglo. Sólo otros 10 países en el mundo tienen más habitantes. Si sumamos los 11 y medio millones de mexicanos que viven en Estados Unidos, la población supera los 123 millones.

A pesar de la sensación de parálisis y estancamiento que rige el imaginario de los mexicanos, el país lleva tres lustros sin ser sacudido por una crisis financiera como las que padecía cada 6 años desde 1976. La consecuencia de esa estabilidad es el ensanchamiento de la clase media, con una reducción de la pobreza, e incluso con una contención pequeña pero sostenida de la desigualdad. Pese a la dramática caída del PIB en 2009, como resultado de la catástrofe financiera originada en Estados Unidos, al finalizar 2010 el ingreso per cápita de los mexicanos era de 13 mil 900 dólares. Comparado con las dos economías más grandes de América Latina, el ingreso per cápita de México resulta inferior al de Chile, con 15 mil 400 dólares, pero superior al de Brasil, con 10 mil 800. En materia de desigualdad, según datos de la CEPAL, México redujo su coeficiente Gini en más de cinco por ciento entre 1999 y 2008, Brasil en tres por ciento y Chile en uno por ciento.

De la misma manera, México ha realizado avances sustanciales en materia política y electoral. Hoy el país goza de un sistema de contrapesos, hay mayor rendición de cuentas, la corrupción ha dejado de ser sistemática y tiene instituciones que garantizan elecciones limpias.

México también ha sido parte del papel creciente de las redes sociales. En 2012, se propició un flujo amplio y oportuno de información sobre los candidatos en Facebook, Twitter y YouTube, que complementó a aquélla ofrecida por los medios tradicionales. Además, aún sin ser lo suficientemente poderosas, las redes sociales son un contrapeso cada vez más eficaz contra los vicios de las televisoras en México.

Pese a los notables avances, México aún camina sobre una línea muy delgada y no puede confiarse. La democracia ha tenido un crecimiento sinuoso y doloroso en este país. Así lo muestra, sobre todo, el lento surgimiento de una sociedad madura y responsable. Poco a poco el país se va haciendo de ciudadanos que participan más en los asuntos públicos, pero necesita de más.

Resulta gratificante la masiva participación ciudadana -más del 63 por ciento de la lista nominal- en la jornada electoral. Miles de ciudadanos se formaron bajo la lluvia para emitir su voto y otros miles más se desempeñaron como funcionarios de casilla.

México podría estar despertando de su letargo y este es el momento ideal para generar la base ciudadana y los mecanismos que sirvan como contrapeso de un gobierno que tendrá la tentación de recurrir al autoritarismo, al clientelismo, al corporativismo y a la corrupción para alcanzar sus fines. Trendrá esa tentación no porque no haya verdaderos demócratas en sus filas, sino porque los partidos politicos, como señala Maurice Duverger, conservan la carga genética que adquirieron desde su origen.

A diferencia del siglo pasado, el PRI gobernará un conjunto de ciudadanos y no de súbditos. La clase media en el país ha aumentado sustancialmente y un número creciente  de jóvenes quieren ser partícipes de un cambio de fondo, tal como lo ha mostrado el movimiento #yosoy132, que a pesar de su aparente sesgo político, ha tenido el gran mérito de despertar el interés de la gente en la elección. Claramente, los mexicanos decidieron no darle poder completo al PRI, quien no tendrá la mayoría en el Congreso como se esperaba.

Sin embargo, la tarea de los ciudadanos no terminó con la elección. Haber repartido los puestos de elección popular no será suficiente. El gobierno de Peña tendrá los incentivos de entregar resultados sólo en la medida en que se haga efectivo el escrutinio de los ciudadanos y la única manera de lograrlo es teniendo ciudadanos informados. Gran parte del poder de la élite política radica en el monopolio de la información que aún sustenta. Una vez que el acceso a la información se hace público y generalizado, los ciudadanos tienen las herramientas para exigir cuentas.

De continuar la escasez de reformas estructurales el descontento de la población sera aún mayor, en especial de los jóvenes, quienes en una cantidad considerable se han mostrado irascibles tras la elección. Un error o la falta de resultados puede hacer estallar al pais. Por eso creo que el PRI tiene los incentivos suficientes para generar un gobierno con los ciudadanos y con las fuerzas opositoras que brinde resultados. Pero estos incentivos tienen que ser creados por los ciudadanos. Hay que depender menos del gobierno pero ser críticos de él y exigirle rendición de cuentas.

México está en una encrucijada y tiene que decidir si vuelve al pasado autoritario del que tanto trabajo le costó salir o si da un salto hacia adelante para fortalecer su joven democracia. Durante los próximos 3 años – antes de las elecciones intermedias de 2015– asistiremos a una prueba histórica de una nación que lucha por despertar de su letargo. La defensa de la democracia será, en última instancia, la construcción de un futuro para México por los mexicanos. Se trata de un momento histórico cuyo resultado podría tener un impacto decisivo en la construcción de la democracia, no sólo en México, sino en el resto de América Latina.

México es un país mejor y más grande que el que está en la cabeza de la mayoría de los mexicanos. Los mexicanos tienen que empezar a pensar un futuro. Es tiempo de ejercer un patriotismo inteligente y defender las instituciones del país. Es tiempo, sobre todo, de asumir la responsabilidad histórica que tienen los mexicanos. Hacer valer su joven democracia significa crecer, modernizarse, progresar y reducir las desigualdad. De ello depende su bienestar y su posición en el mundo.

Income Inequality in the US

“In policy, as well as in morality, the grand secret is not to constrain the actions, but to awaken the inclinations of mankind”

Economics is mostly about expectations. The more confidence people have in the potential of the country’s performance, the more the entrepreneurial spirit will be incentivized.

Governments have lost credibility. Fiscal deficits and financial crises share the same cause as that of income inequality. The economic system favors those at the top, creating a winner-takes-all-society. The system lacks the controls to level the playing field. The rules of the game are unfair.

Income inequality in the United States has progressively grown over the past three decades. According to data from the Congressional Budget Office (CBO), after-tax income for the highest-income households grew more than it did for any other group. The CBO found that, between 1979 and 2007, income grew 275 percent for the top 1 percent of households, 65 percent for the next 19 percent, just under 40 percent for the next 60 percent, and 18 percent for the bottom 20 percent.

Income inequality is threatening the very national character of this country and jeopardizing America’s hegemony and status in the world. In order to solve it, the government must build a new social contract where people actually have equal opportunities to succeed, and the only way to do it is by recovering the confidence of the people.

I believe greed is part of the very human nature. The second law of thermodynamics, entropy, tells us how natural systems in the universe, tend to disorder and chaos. Social systems follow the same pattern. Therefore, we need the incentives and the rules to maintain an equilibrium or to redirect the natural inclinations of human beings. As the economist John Baptiste Say stated in late 1800’s, “In policy, as well as in morality, the grand secret is not to constrain the actions, but to awaken the inclinations of mankind”.

That’s why I disagree with most of the IMF’s recommendations. They suggest to cut spending and consumption in order to reduce the budget deficit, but they have no problem in transferring billions of dollars to banks, who were the main responsible of the crisis, not only in America, but also in Greece and other countries of the EU.

A new economic model would need to create the right incentives that reduce the vulnerability of the economic system. It would take into account the new economic challenges we’re facing and the new realities in a globalized world, such as income inequality and the importance of the middle class. The recommendations contained here are mostly formulated taking into consideration a demand approach, in an attempt to protect consumers as opposed to the measures taken recently by the government to bailout banks:

First, the government should accompany this process proactively, and not only as an observer of a free market economy. Capitalism should continue to exist, but more regulation will be needed to ensure a better distribution of income. Regulation, for example, in the financial industry.

Second, social programs, such as social security and unemployment insurance, are desirable and necessary to create a safety net for lower-income households, mostly when the country is starting to recover from a deep crisis.

Third, government revenues will have to come in the form of taxes. There is no other way. A modern society cannot function without significant taxes. Politicians who consistently say they will cut taxes, they’re lying. When you cut taxes today, you have to increase it tomorrow. People know it and that’s why they smooth consumption through time and spend less today. Remember, is all about expectations. On the other hand, taxes should be progressive and increase as household’s income increases.

Fourth, government revenues should be used partly to ensure the continuity of social programs and partly to reduce the fiscal deficit. This will also contribute to recover the confidence of the citizens on the economy. Government spending should also be aimed at funding education to lower-income individuals through scholarships. Better educated people will boost the emergence of a wave of entrepreneurs.

Fifth, in the long run, resources should be applied to improve the education system and to increase research on science and technology. Innovation is key to adapt to new global challenges we’re facing and the US has historically proved to be at the top of innovation.

In conclusion, an old view of the economy in the United States has failed to explain current economic realities and, more importantly, few people and interest groups have taken advantage of this scenario. The deterioration in such economic indicators –inequality and the middle class to population ratio– has undesirable social consequences. The widening in the income gap and the shrinkage of the middle class in the US is causing a poor economic performance and may eventually spur social instability.

La canción de la caverna

¿Cómo no amarte, alma mía, si me impulsas

a través de las tinieblas?

Es por ti que mis pasiones tienen sentido, mis pasos un ritmo

y mi razón, cuando te escondes, se enferma.

 

¡Ay, caverna oscura, que mi refugio habías sido!

No te condeno ni maldigo las horas en tu lecho,

era mi temor a las alturas que todo daba por hecho.

Cuando alcancé la salida, ya mis ojos presagiaban la luz;

no fue adentro la hoguera, sino el sol abrasante que hirió mi visión,

mas no por ello cesó mi gozo pues al fin conquisté la razón.

 

Eran rayos de luz ardientes por mi llegada,

los vi sabios como dioses y misteriosos como hadas.

Ya su magia me sacudía, ya su parsimoniosa voz

me hipnotizaba con sonetos y cantos.

 

¡Qué bellas figuras encontré allá afuera!

¡Qué sublimes matices adornaban el espacio

y nobles sonidos arrullaban mi oído!

 

¡Cuánto tiempo viví una mentira!

¡Cuánto duré sumergido en un sueño!

Ay, ¿y si esto es una quimera y mi alma sólo suspira?

¿Qué si este mundo tan bello es un espejismo, una ilusión?

 

Quiero morir y quedarme morando estos valles,

estos paisajes invaluables, esta sabiduría infinita.

Mis ojos ya no lloran, apenas pueden dormir

luego de burlar aquel muro infranqueable.

 

Será la muerte mi más amada compañera.

Tras su encuentro hallaré las flores multicolores,

El azul del cielo y el sol con sus triquiñuelas.

No sé cuánto habré de esperar,

mi alma se agita muy fuerte y me muerde:

quiere que vuelva a la cueva y a las sombras ahuyente.

 

¡Oh, paraíso inmutable que has socavado mi mente

y esculpido mi alma!

Contigo aprendí a amar y a pensar,

a contemplar todo bajo el sol y la luna.

He de volver con los hombres a decirles

que realidad sólo hay una;

que las sombras y ruidos son sólo evasiones

y al final queda el consuelo.

¡Mira que puedo morir!

¡Son criaturas salvajes y necios infames!

Pero dichoso aquel que clave en mi pecho la espada

pues a tu solemne morada podré yo volver

para quedarme aquí y jamás perecer.

Why should Carstens lead the IMF?

I’d like to tell you briefly why I think Agustin Carstens, a Mexican economist, should lead the IMF.

First, his carrer speak for itself. As a former Secretary of the Treasury and current Mexico´s Central Bank Governor, he has been a key actor in stabilizing and recovering the Mexican economy after 2009 financial turmoil. He has managed to keep interest rates and inflation low, exchange rate stable, international reserves reached a record high, unemployment has been reduced and the country’s economy is expected to grow by 5% this year.

Second, a non-european head would be best. It appears more logical to me that the next boss come from outside Europe to avoid conflict of interest. Moreover, the balance of power has changed and emerging markets are increasingly becoming lenders instead of borrowers. Countries like China, India, Russia and Brazil are contributing to shape a new financial order and international organizations such as the IMF should reflect this reality. A post World War thinking won´t work in the 21st century.  To learn more visit http://www.economist.com/economics/by-invitation/questions/who_should_lead_imf

Third, having worked for years in a relevant position in the IMF, makes him a strong candidate. The Fund´s agenda is already too busy and the next Managing Director should be able to work efficiently from day one without training. On the other hand, although it seems like he doesn´t really have support from the latin american peers, he does have the backing of Mexico´s President Felipe Calderón, whose international image may be an asset. Moreover, Carstens keeps a good relationship with US Secretary of the Treasury Timothy Geithner and could well be White House´s favourite candidate. See http://blogs.ft.com/beyond-brics/2011/05/24/imf-carstens-who/

It´s the structure, stupid!

Almost a year ago, while on a business trip in Los Angeles, I was discussing a project with my associates to buy farms in California so that production was increased throughout the year. One of our partners stressed the fact that, despite the complaints from many employers south of the border, Mexican workers were very efficient in the U.S.

It was not the first time I heard a comment like that. I was told to be very careful when it comes to hire people in Mexico. In contrast, labor force coming from the same place is highly valued by American companies.

That day, the meeting turned into a lasting discussion. After all, how can the same person behave so differently across the border? I began to pay attention to little details in every business trip. For example, I realized that I tended to be more respectful of traffic signals in the U.S. than I was in Mexico.

On the other hand, I looked at people´s progress. There is a remarkable story of a man born in the U.S. whose parents are Mexican immigrants. As a child, he worked throughout the fields of California, harvesting crops. He once dreamed of being an astronaut and recently was hired by NASA, becoming the first person to use Spanish language in space. Would he have accomplished it if he had stayed in Mexico? It hurts me to say probably not.

There is an answer behind these mysteries. Differences across the border are not due culture or genetics, like I once thought while at undergraduate school. It is rather about structures and institutions that create rules and values; and it is also about government decisions and policies that enable people to have more and better opportunities.