Mexico’s Turmoil

"A lot of people think it's only the gasoline prices, but the price of gas is just the straw that broke the camel's back.” - anonymous protestor.

As is now increasingly the tendency, significant moments of struggle against the effects of the global crisis are given scant attention by media players dependent on capitalist states and business. However, at the time of writing, Mexico has, since 1 January, been the scene of an unfolding drama which has involved a range of popular responses, including significant strike movements, sparked by President Enrique Pena Nieto’s announcement to slash gasoline subsidies. Previously he promised that gasolinazo price spikes were a thing of the past[1] but his decision will increase consumer prices by 14 to 24 percent in the coming year.

Looting (saqueos) of large stores at first confined to 300 stores in three states which left 4 dead, has spread throughout the country. Growing in intensity on a daily basis, workers, youth and other sectors have engaged in a series of actions which demonstrate the possibility of an organised response to the attack on living standards. Demonstrations initially of a largely spontaneous character have spread throughout the county. The burning of effigies of Peña Nieto, blocking many major highways between cities even after the police had cleared them and made many arrests, occupation of the state-owned energy conglomerate Petroleos Mexicanos processing and distribution centres, sabotaging of pipe lines and even the blocking of a border crossing to the United States in Ciudad Juarez. Bus drivers in Guadalajara, Jalisco called the first _gasolinazo-_related strike on Wednesday, shutting down most transit service in the city. Protesters occupied many gas stations across the country, hundreds more have been shut down. On 6 January, there was firm evidence that the initial sporadic spontaneous responses were evolving into a wider strike movement. Fourteen thousand bus, truck and taxi drivers in the oil-producing state of Veracruz announced an indefinite strike through that state, many simply leaving their trucks, cabs, and buses parked on the street. According to the Daily Mail on 6 January, “The country's business chambers said the combination of highway, port and terminal blockades and looting this week forced many stores and businesses to close and threatened supplies of basic goods and fuel.”

Peña Nieto made it clear that there would be no climbdown and a wave of oppression was unleashed. Over a thousand were arrested before 7 January. Two protestors were killed during a large demonstration of thousands on the 5 January, which sparked that same night the biggest demonstration so far of 20,000 through the industrial city of Monterrey, in the north of the country. Thousands of police were sent to occupy the capital city centre, with some 18 000 in the capital’s state where looting has been widespread. Not totally surprising, there is official confirmation that the police themselves joined the looting, with several dismissals already announced. Social media circulates video of uniformed police loading up their vehicles.

Thursday 7 January saw an ebbing of the protests as it is Three Kings Day, an important religious festival in the Hispanic world. But they rapidly leapt up again. Protests broke out notably along the US border, and mobilisations in various states, barricades were set up by truck drivers across important roads, and truckers and locals blocked the Pemex distribution centre in Baja California. The police prevented Mexico City’s taxi drivers from blocking the Metro station in Iztapapa. A mass was held at the barricade blocking the Mexico City -Laredo route, scene of the above mentioned death of two of young protesters, Freddy Cruz and Alan Giovanni Martínez.

But all this, and it is significant in its own right, is only the tip of an iceberg, a long simmering social disaster that is beyond all bourgeois attempts to dispel.

Though part of an extreme global phenomenon[2], Mexico’s inequality and high levels of poverty, remain the defining feature of its economy. Under Peña Nieto’s government that wound has only deepened. According to BBC Mundo July 2015

“In the last two years, the National Council for the Evaluation of Policies of Social Development (Coneval), has informed us that two million Mexicans fell into poverty. Thus the percentage of the population in that situation went from 45.5% in 2012 to 46.2% in 2014. That is to say, 55.3 million people are poor in the second largest Latin American economy.”

And thanks to factors such as the gasolinazo and the global slowdown, the panorama is about to get seriously worse.

According to the same source, only 20.5% of the country’s population fall in the category of not poor and not vulnerable. To be fair, extreme poverty[3] had very slightly ameliorated (11.4 million people, 100.000 less than two years ago). But against the headwind of the conditions now developing, the outlook for anything but worsening pauperisation is not promising. Already Mexico’s inflation is not only negating the effects of the new minimum wage which came into force on New Year’s Day, set at US $3.80/day, the rising cost of basic food items means that those on that minimum wage rate are already worse off than a few weeks ago. Despite living in an oil producing country, a worker on minimum wage would have to work 12 days to fill a tank of petrol. But it’s not just the lowest layer, the decline in the Mexican working class condition is general. A recent study by the Autonomous University of Mexico (UNAM) reported that the purchasing power of the average Mexican had shrunk by 11.1 percent since President Pena Nieto took office in 2012. The price index for the basic food basket required to feed a family of four has increased to 218.06 pesos ($10.19) per day, nearly three times the daily minimum wage[4]. Meanwhile according to the BBC Mundo report of 2015, Mexico is the country where the richest 1% get the highest percentage of total income; 21%.

So it is not too difficult to understand why intense protest can take root in such soil. But there is much more which threatens Mexico’s stability. A level of violence sweeps the country which is generally associated with a war zone. A report published at the time of writing (18 Jan 2017) by the “recognised independent International Crisis Group (ICG)” puts Mexico in the top ten most volatile regions of the world. The level of violence is extreme; the struggle between criminal entities and the State, mutilations and decapitations, 20 000 plus murders per year, half of which can be related to organised crime, including drug dealing, human trafficking, kidnapping, extortion and violence against the authorities to gain influence in the local area. This wave of murder abated slightly between 2012 and 2014 but has surged again. The latest at the time of writing, a shootout in the busiest part of the country’s most well-known tourist destination, Cancun, left 4 dead. Only a few days after a shooting at a night club in the same state an hour away left 5 dead at the Blue Parrot disco.

And the violence is not only from the criminals, cartels and the like. The corruption of the Mexican state means many elements of the armed forces are controlled by the powerful criminal entities and are working together. The relatively recent outcry of the handing over by Mexican police of 43 students to be murdered by organised crime (or they killed them themselves; the ultimate fate of the students is not clear) has shaken Mexico to the core; the same country where in 1968 the State openly massacred protesting students by machine gun from above.

“The Tlatelolco massacre was the killing of an estimated 30 to 300 students and civilians by military and police on October 2, 1968, in the _Plaza de las Tres Culturas_ in the _Tlatelolco_ section of _Mexico City. The events are considered part of the Mexican_ Dirty War, when the government used its forces to suppress political opposition. The massacre occurred roughly 10 days before the opening of the _1968 Summer Olympics_ in Mexico City. More than 1,300 people were arrested by security police. There has been no consensus on how many were killed that day in the plaza area.”[5]

But if up to that time the Mexican ruling party, the PRI or Partido Revolucionario Institucional[6], was able to secure permanent power by a combination of carrot and stick with forty years of economic growth, GDP increasing six fold between 1940-70, and later, by vote rigging, it like every other capitalist state since the current crisis broke out some forty years ago, has found itself mired in economic crisis[7]. It is thus ever more obliged to rely on repression. In Mexico, like everywhere else, neoliberal economic medicine only hides a few symptoms whilst making the patient sicker.

Not surprisingly, this repression did not fail to provoke an opposite violent response. Arguably the war with the EZLN (Zapatista army of National Liberation) which began in 1994 was the straw that brought the PRI crashing down. The killing of half-starved peasants dressed in rags by mechanised state forces only provided a potent image against a backdrop of economic disaster which got worse as investors saw this uprising, and the assassination of the PRI presidential candidate Luis Donaldo Colosio as sufficient reason to put a risk premium on Mexican assets. To this day the region which gave rise to the EZLN suffers almost unbelievable levels of economic deprivation. In Chiapas three quarters of the population are poor, and almost a third suffer extreme poverty. Seeing the painfully thin, ragged bodies in pools of blood was no doubt harrowing for the Mexican population who increasingly protested against the electoral fraud which always gave the PRI victory despite the unfolding economic decline. The PRI fell in 2000. But of course the global capitalist crisis has continued to choke the life out of the world’s exploited, and the PRI it saw its fortunes reversed, returning to power under Peña Nieto after 12 years in opposition, in 2012. Many remembered the PRI’s record and warned that an abusive spouse had returned. Others pointed out that the PAN which had taken over from the PRI was also incapable of resolving the economic decline. Average GDP growth was only 1.8% between 2000-2012 so poverty increased whilst the policy of taking on organised crime as their flagship policy led to the bodies piling up in their tens of thousands. As Marxists we can conclude both perspectives were correct.

But poverty, violence, repression, skinny bodies in pools of blood, extreme inequality, is not the whole story. It is not enough to explain the widespread perspective that Mexico is situated to become one of the globes most volatile areas, where instability is widely predicted, and where the working class are quick to take to the offensive.

The global capitalist crisis is the backdrop against which all these phenomena are being played out, from collapse of entire imperialist blocs, unemployment and poverty to financial crashes and Brexit, Populists, the creaking of global banks, the sharpening of bellicose rhetoric and imperialist confrontation, and of course, Trump.

Already there are signs that Trumps rhetoric regarding hefty tariffs on Latin American goods is bad news for the Mexican economy. Fiat Chrysler announced that production of two Jeep models currently being assembled in Mexico will shift to the United States. Last week Ford Motor Company said last week it had abandoned plans to build a new plant in Mexico.

The response of the Mexican government to the loss of US investment is yet more attacks on a drowning workforce in order to attract international investment. They have just published the Economic Strengthening and Family Economic Protection Pact which attempts to sugar coat an austerity programme with a few small infrastructure projects. But the planned $8.9 billion budget cuts will serve to further demolish social programmes and promote poverty. Prominent Trade Union leaders, including the leader of the Confederation of Mexican Workers (CTM) have signed up to this pact, encouraging workers to return to work, to abandon any autonomous, real struggle against the gasolinazo or any other aspect of their conditions.

The Mexican ruling class have possibly already decided to once again defuse popular anger by allowing the party of the extremely unpopular Peña Nieto to go back into opposition. As there is only a single six-year term for the Presidency, with no re-election, the President himself has not long to serve. A left capitalist party, MORENA, led by Andrés Manuel López Obrador who is seen by some as Mexico’s Bernie Sanders, and who has amply demonstrated his pro-capitalist perspective, is attempting to drum up hope of a change through electoral means alongside the unions, the politicians, and the establishment in general. The working class, face nothing but a worsening panorama and a storm of growing intensity. As victims at the sharp end of a crisis which everywhere is drawing blood, they must not be deceived. Our message is loud and clear; in Mexico and elsewhere, no support for any bourgeois factions, solutions, elections, nationalist illusions. Our solution lies in the autonomous struggle, strikes outside union control, the building of the revolutionary party with the objective of abolition of capitalism. There is no better day to be had under a system which is already crushing the life out of the vast majority, siphoning all wealth into an ever smaller elite club of the mega wealthy. If we heed the siren songs of the capitalist alternatives, which will always be there to derail the working class struggle, they will just keep us marching down the road to ruin.


18 January 2017

[1] Translated from BBC MUNDO –“However in the past he had said, or so the majority of the population seemed to understand it, that thanks to reforms, prices would come down. It was a campaign promise in 2012, repeated the following year, he assured it in 2015 and said it again last year: in Mexico the price of fuel would lower, there was no more "gasolinazos", the energy would be cheaper. These statements of Peña Nieto have been recalled in recent days.

The increase left the Government in an awkward position and cast stains amongst certain sectors on the credibility of the energy reform: one of the flagships of the President approved in December 2013, which opened the exploitation of hydrocarbons and electricity to the free market, and generated the specific expectations of lower prices of fuels.

The reform put an end to the monopoly of petroleum in the hands of Pemex. From this year there could be gas stations from other companies and fuel imports will be freed in 2018. "There is a confusion". The reality is that gasoline most consumed by Mexicans increased its price by 48% during the current Government.

[2] “New estimates show that just eight men own the same wealth as the poorest half of the world. As growth benefits the richest, the rest of society – especially the poorest – suffers.”




[6] The Institutional Revolutionary Party (Spanish: Partido Revolucionario Institucional, PRI) is a Mexican political party founded in 1929, that held power uninterruptedly in the country for 71 years from 1929 to 2000, first as the National Revolutionary Party, then as the Party of the Mexican Revolution.

[7] All this prosperity ended when the over-supply of oil in early 1982 caused oil prices to plummet and damaged severely the national economy. Interest rates skyrocketed in 1981 and external debt reached 86 billion dollars and exchange rates went from 26 to 70 pesos per dollar and inflation of 100%. This situation became so desperate that Lopez-Portillo ordered the suspension on payments of external debt and the nationalization of the banking industry in 1982 consistent with the Socialist goals of the PRI. Capital fled Mexico at a rate never seen before in history. The Mexican government provided subsidies to staple food products and rail travel; this diminished the consequences of the crises on the populace. Job growth stagnated and millions of people migrated North to escape the economic stagnation. López Portillo's reputation plummeted and his character became the butt of jokes from the press.

Saturday, January 21, 2017


Latest in an ongoing situation ....

Breakdown in Mexico-US relations as Trump threatens trade war

By Eric London

27 January 2017

On Wednesday Donald Trump announced the construction of a wall along the US’s southern border, provoking a diplomatic crisis without precedent in the modern history of US-Mexico relations. When Trump repeated his ultimatum that Mexico pay for the cost of construction, Mexican President Enrique Peña Nieto cancelled a visit to the White House that had been planned for January 31.

Following Peña Nieto’s announcement yesterday, Trump administration Press Secretary Sean Spicer announced that the US government would fund the wall by imposing a 20 percent tax on Mexican imports. The New York Times wrote that “decades of friendly relations between the nations—on matters involving trade, security and migration—seemed to be unraveling.”

Though the White House later said the final decision to impose the import tax had not yet been made, the possibility of such a measure threatens to launch a trade war with profound implications for both countries. The move comes as the US threatens to renegotiate the North American Free Trade Agreement (NAFTA), which has formed the basis of close US-Mexican trade ties since its enactment in 1994.

The US is Mexico’s largest trading partner, with 80 percent of Mexican exports going to the United States. Mexico is the third largest US trading partner, behind China and Canada. Under NAFTA, American corporations have relied on the use of cheap Mexican labor for manufacturing. Within minutes of Spicer’s announcement of a possible import tax, the Mexican press ran the news with banner online headlines.

Spicer’s announcement is the latest in a series of provocative moves by the US government aimed at deliberately escalating tensions between the two countries. The Trump administration is treating Mexico like a semi-colonial subject and is threatening to impose humiliating and unacceptable conditions as the price for continued trade relations.

The consequence of this spat with Trump is to make Pena Nieto look like a defender of ordinary Mexicans and as Carlos Slim (oxymoron if ever there was for this fat billionaire) is right it has rallied "the country" around the Mexican government. Obviously he exaggerates but it is not doing the Mexican government any harm right now.

Looking at it from a Marxist perspective, there are two opposing sides. On the one hand the ruling class of both countries share a common interest- extraction of maximum surplus value. On the other, the working class on both sides of the border. The nationalist posturing will at best lead to a reconfiguration of the exploitation of the working class by the ruling class, a possible opportunity for the rivals of the USA to expand their empires, but as we know, if these events do not act as a catalyst for the emergence and fortification of an anti capitalist political reference point, they mark another stride down the road to ruin, lined with national flags and anthems.

Thinking about it, perhaps the Mexican events are part of a new wave of struggle involving a blend of elements. I read this about Oakland, but Mexico probably illustrates it better;

But it is unclear in what way the labeling of this event as ‘strike’ was a handicap: 2 November was doubtless the high point of the movement. If it’s true that the term ‘strike’ was a false one, this seems to have been a generative rather than limiting delusion. In any case, we don’t believe the term ‘general strike’ meant what the authors imagine it meant for the participants – that is, we don’t think it was delusion. As we remember it, to call for a general strike meant, rather, to call for a general attack on the economy as such; in other words, it was a call for an interruption of the capitalist economy, whether by withdrawal of labour power (individually, collectively), blockade, occupation, targeted sabotage or generalised rioting. All of these tactical elements combined on 2 November. This sense of strike is neither new nor lost to history, as we shall see; it persists in dialectical relation to particular conditions. As the authors themselves note, the ‘strike’ as withdrawal of labour is merely one among the ensemble of elements which come together in the ‘general strikes’ of the past. If withdrawal of labour was the primary element in the general strikes of the past 130 years—which from the outset involved blockade, expropriation, sabotage—increasingly that role is now held by the blockade. These blockades have as their subject proletarians in the expanded sense that includes not only labourers, but all those who are ‘without reserves,’ including the unemployed. The blockade is the form for an era of expanding superfluous populations, as the piqueteros of Argentina and more recently the piquets volants of France have already shown us.

and now Mexico.

The opioid epidemic that has caused so much pain in the United States is also savaging Mexico, contributing to a breakdown of order in rural areas. Heroin is like steroids for drug gangs, pumping money and muscle into their fight to control territory and transportation routes to the US.

Mexico provides more than 90 per cent of America’s heroin, up from less than 10 per cent in 2003, when Colombia was the main supplier. Poppy production has expanded by about 800 per cent in a decade as US demand has soared.