Analysis Agenda – June 11th, 2013

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week-ahead

Even though elections throughout 14 Mexican states are less than a month away, political waters appear to have calmed down considerably. It seems like a long time ago when party leaderships bitterly complained about the budget of social programs allegedly used to favor PRI candidates in local posts at stake. By contrast, the enactment of reforms on telecommunications and economic competition was a sort of referendum to test the Pact for Mexico and the intention of its signatories to continue in it. The suspension of tours led by President Peña through states where elections will be held can also be seen as a “goodwill gesture” towards the opposition. The point is that media attention has ceased to revel in speculation about the Pact’s collapse and currently suffices by reporting on small scandals: Granier, Fox and his “cannabic” agricultural vein, evangelist politicians and so on.
1-The “new” regulators, IFETEL and COFECOE: time to provide “claws and teeth”. After several weeks of delay of being ratified by most of the local Congress in the country, the constitutional modifications on telecommunications, broadcasting and economic competition were enacted by the President. However, as Peña Nieto said himself, the “brave steps” taken with reforms should be consolidated through secondary legislation. By June 10, 180 days will be the period of time to clearly define, among other things, how it will work, who will be part of it and which sanction powers will the renewed regulation bodies have over IFETEL (Federal Institute of Telecommunications) and COFECOE (Federal Commission of Economic Competition). Where should secondary legislation place its emphasis in order to transform the aforementioned autonomous organizations into true enhancers of economic development and not just legitimize the status quo?
2-The Mexican State, or when the only thing left is to pray. A major controversy was unleashed with the mayoress of Monterrey, Margarita Arellanes, on an act organized by evangelical organizations in favor of peace. Everything went along well until the municipal president literally, “surrendered” the city to “our lord Jesus Christ”, while recognizing God as “the highest authority”. Likewise, Arellanes, anticipating the tide of criticism that came upon her for violating the Constitutional dispositions about the secularity of the State – still included after the recent modifications to its 24th article – argued against by discrediting and calling “intolerants” those who dared to question her stance. Even though in the past other authorities have unashamedly shown their faith while exercising their administrations, few had done it with such an evangelizing spirit as the mayoress. How far should the State endure these acts of intolerance and imposition for a specific religion?
3- Vicente Fox and his “entrepreneurial vision” about marijuana. The former President Fox has the “talent” of creating controversy every time he makes a public statement. The issue was the possibility of legalizing the growing, distribution and sale of cannabis. It is no secret that the head of San Cristóbal Ranch has been convinced of legalizing it from his time as President. It is worth remembering that when he sent a concerning initiative to Congress, legislators approved it but it was Fox himself who decided to veto it. In this context, it comes to mind the statements made in 2009 by the Deputy Secretary of Agribusiness Promotion of SAGARPA (Secretariat of Agriculture), Jeffery Max Jones, where he urged farmers to learn the logics of the drug trafficking market, with the goal of maximizing their profits. Will the time have come to reflect on the benefits that Mexico could gain through the legal commercialization of cannabis or should we disregard these arguments as irresponsible talk?
4- Will “chemist” Granier hold the formula to prove his innocence? On June 10, the former Governor of Tabasco, Andrés Granier Melo surprised everyone by giving an interview in the TV news broadcast of Carlos Loret de Mola. During his participation, he said he was in Miami (probably staying in his son’s 289 thousand dollar apartment), and would be flying back to Mexico in the coming hours with the purpose of clarifying his judicial situation. The truth is that before Granier’s TV appearance, his former state treasurer, Manuel Saíz, was handed over to the PGR after being captured by Tabasco authorities, in order to respond to the graft criminal charges against him, for a total of 88.5 million pesos. Nevertheless, the embezzlement of Tabasco’s resources reported by current Governor Arturo Núñez, has already reached 23 billion pesos. Will justice be applied with Granier or will the “scapegoat argument” come up once again?
5- Poor, poor government! On an interview for El Universal newspaper, the Deputy Secretary of Income of the Treasury Secretariat, Miguel Messmacher, stated that this will be a year with no surplus for the public treasury. On the other hand, in a report published by the Center for Economic Studies of the Private Sector (CEESP), the slowness in which the public expenditure is being done was criticized, given the fact that the under-spending is 20 billion pesos higher than the first half of 2012. Generally, reasons for this lack of expenditure are linked to the strategic waiting of “opening the key” in politically convenient times, for example, on the eve of elections. However, this doesn’t seem to apply in the coming July elections. In a government that has promised the implementation of intensive social programs that surely won’t lack expenditure, what will its real strategy be? What is the relation between this resource “retention” and the coming discussions on the tax and energy reforms?

Antonio De la Cuesta

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