Politically and economically, he has to walk a tightrope

Mexico's Salinas, A Year Later

By , M.Delal Baer is director of the Mexico Project at the Center for Strategic and International Studies in Washington, D.C.

WILL the real Carlos Salinas, president of Mexico, please stand up? Is he an unrepentant authoritarian or a democratic reformer? Is he a neoliberal conservative or a closet statist? After one year in office, Carlos Salinas's record remains controversial. Mr. Salinas paints himself as a political reformer, sacking corrupt politicians and union officials. Indeed, the casualty list reads like a Mexican Who's Who. But what of democratic reform and the future of single-party rule? The Salinas strategy is to democratize rapidly enough to defuse frustration, but slowly enough to ensure stability, restore economic growth, and bolster PRI's fortunes. Positions will be ceded at the state and local level while national control is retained. The evidence suggests that Salinas is a shrewd practitioner of realpolitik who plays to win.

The 1989 state and local elections were a bellwether. When the conservative opposition, PAN, organized massive poll watching brigades in the state of Baja California, the reward was official recognition of a historic gubernatorial victory.

For its part, the leftist opposition, PRD, pursued the politics of provovation in those same July elections in Michoacan, occupying over 50 municipal buildings before polling even began. The result was repression. Although some proclaimed Salinas a reformer after Baja, he was accused by the left of engaging in a ``selective democracy'' that favored the PAN.

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Recent November municipal races challenge the ``selective democracy'' charge. The PRD won an important victory in Morelia, the state capitol of Michoacan in a somewhat calmer campaign. By contrast, a post election clash between PAN zealots and PRI diehards in the city of Culiacan left one dead. The results suggest that if there is a policy of ``selective democracy,'' what's rewarded is the willingness of opposition parties to foreswear violence and behave responsibly.

The spectacle of a quasi-democratic PRI battling a quasi-democratic PRD and the histrionic PAN leads some disgusted observers to wish a plague on all their houses. Democracy must be reconciled with stability, and Mexico's embryonic opposition parties have little experience with the politics of compromise. Official failure, however, to respect the electoral process creates opportunties for extremists and undermines the credibility Salinas could have as the broker of peaceful political reform. Only as Salinas lays the building blocks of democracy and Mexico's opposition practices maturity and moderation will a stable transition to democracy occur.

Salinas has initiated a barrage of privatizations, trade liberalization, and deregulation. Spectacular privatizations have occurred with the sale of Mexicana Airlines to Chase Manhattan, Drexel Burnham, and Sir James Goldsmith, and the government's announced intention to unload Telefones de Mexico (Telmex), the fourth largest business in the nation. Foreign-investment regulations have been liberalized, the petroleum industry opened to greater foreign participation, and an open trading regime maintained.

However, economic reform could stall. Mining and steel privatizations are slowed by union militancy, making the industries less attractive to skittish investors. Cananea copper is on the auction block, but suffered labor setbacks. Bitter strikes have crippled Sicartsa and Altos Hornos steel works. The agricultural giant, Conasupo, will undergo only partial privatization. Salinas also has been reluctant to permit foreign majority investment in Telmex.

Salinas is walking a tightrope. The decay of European communism is a political windfall for Salinastroika. However, Mexico still has pressing social problems and an unfashionable attachment to populist dogma. Furthermore, Mexicans know what Poles will soon find out - that economic reform means layoffs and plant shutdowns in the short run. Leftist opposition leaders take advantage of labor strife, making building political support for a market economy difficult. Political pressures to increase social spending and slow down difficult privatizations will only increase as Mexico moves toward its 1991 midterm elections.

Hesitation and half measures may be fatal. Building support for privatization is not made easier if the leaders of economic reform waver in the commitment. Salinas may be his own worst enemy if he caves in to the social-welfare strains in the Mexican revolutionary heritage. Like Soviet President Gorbachev, Salinas must reconcile revolutionary political mythology with what he knows to be economic common sense. Salinas cannot afford to make Mr. Gorbachev's mistake of criticizing Stalin but defending Lenin.

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