If Mexican President Andres Manuel Lopez Obrador has been punished for his loss in this month’s midterm elections, he hasn’t shown it.
The morning after the June 6 vote, the government published a law extending the term of Chief Justice of the Supreme Court, Arturo Zaldivar, a confidant of the president, in what critics fear may provide a model for Lopez Obrador to extend his own term beyond 2024.
Within days, the president pledged to continue constitutional reforms in the areas of energy, elections, and security, though He lost a two-thirds majority Necessary for such changes in Congress. He accused the “abnormal, slanderous and immoral” media of poisoning voters against him and attacked the middle class as a selfish social climber.
Despite the fiery rhetoric, to some this seemed like business as usual for Lopez Obrador rather than switch to a more radical agenda after his Morena party lost about a fifth of its congressional seats and more than half of the provinces in Mexico City.
“Obviously Amlo will continue to be Amlo, and this is something businesses and society will have to learn to live with – we are not going to change it,” said Antonio del Valle, president of the Mexican Business Council that represents the country’s largest companies. using the title of the President.
But after three years, we can now understand that, just as he will not change politically, he will not change his economic policy either. . . This reassures me a lot.”
Top business leaders have learned to look beyond the scorching populist messaging and applaud how he has resisted pressure to borrow heavily to spend big, like other leftists in Latin America.
“The president’s bark is worse than his sting,” said one CEO, who asked not to be named.
While his rhetoric remains confrontational, many observers expect a small deviation from the plan he has long drawn to achieve Mexico’s “transformation”: social programs to address deep income inequality, and infrastructure projects in the impoverished Southeast to create jobs and energy. Self-sufficiency based on fossil fuels.
After a stint as mayor of Mexico City in 2000-2005, in which Lopez Obrador showed a pragmatic line, “I expected him to be more moderate, and he wasn’t,” said Porfirio Muñoz Ledo, a totemic figure in the Mexican left and one of the few in the ruling Morena party. who criticizes the president.
Lopez Obrador’s desire to extend Zaldivar’s term to secure a judiciary more compliant with his attacks on the respected electoral authority INE, as well as independent regulators, has sounded alarm bells.
“I hope he won’t tighten the presidency to oppose the institutions,” Muñoz Ledo said. “The presidency of Mexico is really very powerful.”
Claudia Sheinbaum, Lopez Obrador’s stepdaughter and Mexico City mayor, derided what she described as opposition efforts to portray the election as a turning point for democracy in Mexico with “this idea that it would be the last time we voted because we were headed toward dictatorship.”
Graham Stock, partner at BlueBay Asset Management, saw Lopez Obrador’s “limited opportunity” to radicalize without a supermajority in Congress and dismissed comparisons with the late authoritarian Venezuelan leader Hugo Chavez.
“He’s financially conservative, so he’s not going to spend money in a dash for growth,” he said. “The narrative of chaos and destruction that his opponents have long been trying to tell will happen – I’m not buying that… He’s not the next Chávez, he’s one of a kind.”
After winning a landslide in 2018, Lopez Obrador kept his supporters loyal to handouts, higher pensions and big increases in the minimum wage. His stubborn refusal to take on more debt led to a lack of a Covid-19 stimulus program, leading to a deeper recession last year than many of his Latin American peers.
Jorge Castañeda, a former foreign minister from the conservative PAN party, said he believed Lopez Obrador had missed an opportunity to use his “enormous legitimacy” to enact far-reaching reforms.
“What you have to do is what he didn’t do, though he could have: serious tax reform,” he said. López Obrador has promised to fill in the loopholes rather than raise taxes.
“It may sound short-term, but it’s practical logic,” said Gerardo Esquivel, deputy governor of the Bank of Mexico. All previous attempts at financial reform have been political failures. . . In his opinion, it is more transformative to get people to pay what they ought to get and get paid where they ought to be.”
Mexico’s economy now on the recovery After contracting by 8.5 percent in 2020 and heading for growth of 6 percent or more this year, aided by President Joe Biden’s $1.9 trillion stimulus package in the United States.
But the climate of uncertainty lingers, fueled by Lopez Obrador’s cancellation of airports and partially built breweries, weighing on the investment Mexico needs to break out of traditionally weak growth rates.
Lopez Obrador’s relentless attacks on political enemies, including the wealthy, the media and the business class, have also raised concerns about the risks of further division in an already deeply divided and violent society.
“The most important thing is to stop the polarization in the country: rich versus poor, north versus south,” said the CEO of a Mexican bank. “We all need to paddle in the same direction for the boat to advance.”