When Mexican President Miguel de la Madrid Hurtado stood to inaugurate the 1986 World Cup soccer championship, his speech was virtually inaudible because of the boos from many of the 100,000 people in the stadium. It was a rare and embarrassing expression of the lack of confidence in the President's ability to handle Mexico's severe economic crisis. Mexico was bankrupt when President de la Madrid took over in 1982, and people were willing to tolerate some tough times in order to see their economy grow again.
But now it is 1986, and Mexico is on the verge of bankruptcy again. That's why, out of frustration, people jeered him at the May 31 opening soccer match. They were letting him know what they thought of his promises and measures to turn the economy around.
Now almost two weeks later, it appears that the spontaneous outburst by people wealthy enough to buy opening day tickets has triggered an even more serious vote of no confidence in the government. Since then, it has not been foreign soccer fans and tourists who have jammed the banks and exchange houses daily to change money. Rather, a significant number of Mexicans are rushing to convert their pesos into dollars to safeguard the value of their money.
Exchange houses along the United States-Mexican border estimated that in four days of trading last week, 3.5 billion pesos ($4.69 million) had been sold for dollars. A US Federal Reserve report said that Mexican bank accounts in the US totaled $13.9 billion at the end of 1985. Economists and bankers here say Mexico's foreign reserves now stand at about only $2.8 billion.
In short, there is financial panic here. Rumors abound. Mexicans expect that the government is broke or will declare a moratorium on its foreign debt, which means that it would not receive any new loans to keep the country solvent. Some think that both will occur in a matter of weeks. Some expect a devaluation. And others say that the government won't act at all, which scares them just as much. Whatever happens, they don't expect the next few months to bring anything but higher inflation and a peso worth even less than it is now.
On May 30, the uncontrolled peso closed at 556 pesos to the dollar. This week it went as high as 950 to the dollar at the border, and it opened here Tuesday at 746.
Alicia Macias, a secretary, calls the exchange houses at least twice daily to check the rate in order to decide when to buy or sell more dollars. This will give her enough pesos to cover a few days living expenses. She then advises her friends. This has become routine for her and many other Mexicans.
Many Mexicans feel the only way they can protect themselves is by putting their money into dollars. ``What is going to happen to us,'' ask many of one travel agent's foreign customers. Like many other Mexicans, she thinks they should know more about Mexico, since she believes other nations will have to bail Mexico out.
``If the Americans won't lend Mexico money because of Gramm-Rudman, do you think they could lend me a little bit, since I don't need quite so much?'' asks a Mexican professional who has just opened his own business. He bemoans the fact that he has chosen the worst possible time in Mexican economic history to do so. His question is a joke, but his worry is real. He knows he can get neither credit nor loans and is borrowing from friends to pay bills until the business takes off. How can his business get going, if day by day Mexicans have less to spend, he asks.
For months the government has been running radio and television commercials in which a wife asks her husband why he has been so despondent and uncommunicative recently. He explains that times are so bad that he can't see the light at the end of the tunnel. His wife replies, ``It is exactly because of this that you have to keep working and work even harder to survive this crisis and to set an example for the children that shows you believe Mexico will come out all right.''
But Mexicans aren't buying that. They think they have sacrificed a great deal in the last four years, and that they are back where they started.