Latin America Solidarity News 1st October 2006
Voz Latinoamericana Wellington Access Radio 783AM Mondays 5-6pm
(radio streaming www.r2.co.nz/meta/accessradio-56.asx - www.accessradio.org.nz/
Next Peña Cultural Latina 6th October, Friday 6pm
Films, live music, food and conversation from 6pm
128 Abel-Smith St, Wellington. All welcome. Please come along and bring your friends
"Eyes of the Rainbow" film screening Monday 9 October.
128 Abel-Smith St, Wellington
THE 2006 CUBAN FILM FESTIVAL
SI! CUBANAS! WOMEN BEHIND THE CAMERA
Auckland 27th September–11th October 2006
Wellington 10th–14th October 2006
Hamilton 5th–7th October
Raglan 8th October
FOR A LIST OF FILMS, VENUES AND SCREENING TIMES, GO TO:
How did we sink so low in just 6 years?
In a 253 to 168 “party-line” vote, the congress repealed habeas corpus and approved the torturing of prisoners in American custody. It is breathtaking assault on human rights and personal liberty and puts the United States well-outside the community of civilized nations.
Globalisation: make it work - Joseph Stiglitz
Another world is possible, says the renowned economist. But by crisis or choice?
Early in the book, Stiglitz contrasts developmental success in east Asia - whose governments, he said, kept a wary distance from the International Monetary Fund (IMF) - with economic instability and widening income inequality in Latin America, where the policies of the Washington consensus were followed to the letter.
Don't Cry to Them, Argentina
Is Monsanto playing fast and loose with Roundup Ready Soybeans in Argentina?
In Argentina, which ranks second only to the United States in production of genetically modified crops, agro-giant Monsanto's Roundup Ready Soybeans are increasingly ubiquitous -- and controversial. RR soy fields are taking over jungles and savannas, with steep social and environmental consequences; meanwhile, Monsanto is finagling in European courts to reap more profit from Argentine farmers. Kelly Hearn traces a story of industrial-ag shenanigans and eco-ruin.
Chavez's Oil Gift, Part II
September 21, 2006, New York Daily News
Hugo Chavez, the fiery president of oil-rich Venezuela, is
pumping up the volume - of cheap fuel oil for low-income New
Yorkers. And he's named a Kennedy as head salesman.
Individual homeowners and cooperatives in four of the city's
five boroughs will be able to buy cheap fuel this winter from
an oil-for-the-poor program, sources have told the Daily News.
CITGO Petroleum, the U.S. subsidiary of Venezuela's state-
owned oil company, has earmarked 25 million gallons of fuel
for low-income New York residents this year at 40% off the
wholesale market price.
That's enough fuel to heat 70,000 apartments, covering 200,000
New Yorkers, for the entire winter.
Bolivian President Evo Morales on Latin America,
U.S. Foreign Policy and the Role of the Indigenous People of Bolivia
Evo at the UN
Speech delivered by the president of the republic, Evo Morales Ayma, in front of the United Nations General Assembly. New York, September 19, 2006.
Thank you, president. Fellow brother and sister presidents, delegates to the 61 Ordinary Reunion of the United Nations.
It is an enormous satisfaction to be here present, representing my people, from my homeland, Bolivia and especially the indigenous movement.
I want to tell you, that after 500 years of be looked down upon, at times considered to be savages, animals, in some regions condemned to extermination, thanks to this consciousness and this uprising and to the struggle for the rights of the peoples I got to, we got here to repair the historic damage, to repair 500 years of damage.
During the republic, we were equally discriminated, marginalised, they never took into account this struggle of the peoples for life, for humanity during the last 20 years, with their application of an economic model - neoliberalism - that continued the looting of our natural resources, the privatisation of our basic services.
Convinced, and we are convinced, that the way of privatisation of basic services is the best way of violating human rights.
And these small considerations oblige me to say the truth here about the livelihoods of these families, I come to express this sentiment for the humanity of the peoples, from my people. I come here to express the suffering, the product of marginalisation, of exclusion, I come to express above all else, this anti-colonial sentiment of the peoples that struggle for equality and justice.
I want to say to all of the delegates, Ms president, that in my country we have begun to search for deep democratic and peaceful transformations, we are in a stage think of how to refound Bolivia, refound Bolivia to unite Bolivians, refound Bolivia nor to take revenge against anyone, despite the fact that we have been kept down through discrimination, refound Bolivia, above all, to finish with distain, hatred, against the peoples.
I say this because my mother was commenting to me, saying, that when she went to the city, she did not have to right to walk in the principal plazas of the cities of my country, they didn’t have the right to walk on the footpaths.
But happily we have decided to pass over from the social, union, communal struggle to an electoral struggle so that we ourselves can be the actors to resolve social problems, economic problems, structural problems, and we are waging for this Constituent Assembly of refoundation, and I would like the United Nations to participate in this process of peaceful and democratic change, which is the best we can do for these abandoned, marginalised families.
Certainly, many countries have the same problem as my country, a country, a nation with so much wealth but also with so much poverty, where the natural resources have historically been stolen, looted, auctioned off by the neoliberal government, handed over to the transnationals.
The time has come, now at the head of this struggle of the peoples for power and land, to recuperate, recuperate those natural resources for the Bolivian state under the control of the peoples.
And when we speak of recuperating our natural resources, via the dirty campaign of accusations, they say that the government of Evo Morales will not respect private property, I want to say to you, in my government private property will be respected.
It is true that we need investment, we need partners, not bosses, not owners of our natural resources, we understand perfectly that an underdeveloped country needs investment, and I want to say, to clarify in front of all of you some worries, some false accusations; if the state exercises the property rights of a natural resource such as natural gas, hydrocarbons, oil, then we don’t expel anyone, we don’t confiscate off anyone.
It will be respected, but we guarantee that they recover their investments and have make an earning, but they will not earn like before, from the (fat) so we are left not being able to resolve the social problems in my country later.
I want to say to you within this framework, I don’t come here to tell you how to govern or to threaten a country, or to begin to put conditions on a country, I only want you as international organisations, as a state with solidarity, as nations with principals of reciprocity, of brotherhood, to participate in this process of democratic change.
We have a great desire, a great interest in their being a conscious of this class in international forums, international reunions such as the United Nations to support, to wager on peaceful changes.
All of you know, especially here in North America as well as in Europe, that there are many Bolivians who go in search of work, before it use to be the Europeans that invaded Latin American, especially Bolivia, now it seems that the situation has changed, it is the Latin American, or the Bolivians, that are invading Europe like they did to the US before. Why? Because in this conjuncture, at this moment there is no job creation.
I want to say to all of you that we want to wager for a just trade, a peoples trade for the people, a trade which resolves the problem of jobs, that trade for companies is important is clear, but trade for micro and small producers, for cooperatives, for associations, collective companies, is more important.
I would like, and this is the one wish I have, that instead of my sisters and brothers going to Europe, how much better would it be that products go there and not human beings, and I believe that this has to do with consciousness in the international community, if we want to resolve the issue of immigration.
I have information that our sisters and brothers are not going there to monopolise thousands of hectares as those that came to Latin America did when they monopolise thousands of hectares, they came to take over ownership of our wealth, of our resources.
I believe that it is important that within this framework of trade, trade that is referred to as free trade, even in my country, affected and eliminated the large producers, the agro-industrialists, imagine the agreement signed by Colombia with the United States over the Free Trade Agreement, is already taking away markets from the soya farmers in Bolivia, from the agro-industrialists in Colombia.
I am convinced that it is important to import what we do not produce and export what we produce and that this would be a solution to the economic problem, the problem of employment.
I would like to take advantage of this opportunity, Ms president, to say that there are also other historical injustices, such as the criminalisation of the coca leaf. I want to say, this is a green coca leaf, it is not the white of cocaine, this coca leaf represents Andean culture, it is a coca leaf that represents the environment and the hope of our peoples.
It is not possible that the coca leaf is legal for Coca Cola and that the coca leaf is illegal for other medicinal purposes in our country, and in the whole world.
We want to say, that it is important that the United Nations recognise that with the help of North American universities, with European universities, we have scientifically demonstrated that the coca leaf does not damage human health.
It is very lamentable that due to customs, to bad customs, that the coca leaf is derailed into an illegal problem, we are conscious of that, that is why we say as producers of the coca leaf that there will not be free coca cultivation, but nor will there be zero coca.
The previously implemented policies, that had conditions imposed, talked of zero coca, zero coca is like talking of zero Quechuas, Aymaras, Mojenos, Chiquitanos in my country, this finished with our government, no matter how underdeveloped our country is, a country with economic problems which are a product of the looting of our natural resource wealth.
And we are now here to dignify ourselves, and we have begun to dignify our country, and within this process of dignifying I want to say, that the best proposal for the struggle against narco-trafficking has been voluntary reduction, agreed upon without deaths or injuries.
Happily I have heard the report from the United Nation, which recognises that this honest, responsible effort, in the struggle against narco-trafficking, has increased efficiency by 300% as opposed to confiscations which seize drugs,.
Nevertheless, yesterday I heard a report from the government of the United States, it says, that they do not accept the cultivation of coca, and that they are putting conditions on it that modify our norms.
I want to say with great respect to the government of the United States, we are not going to change anything, we don’t need blackmail and threats, the so-called certification or decertification in the fight against narco-trafficking is simply an instrument of recolonialisation or colonialisation of the Andean countries, that is unacceptable, that can not be permitted.
I want to say to you that we have, and we need, an alliance to fight against narco-trafficking, but one that is real and effective, so that the war on drugs can not be used as an instrument, a pretext, for them to subjugate the countries of the Andean region, just like they invented preventative wars to intervene into some countries of the Middle East.
We need a real fight against narco-trafficking, and I call on the United Nations, I invite the government of the United States to make an agreement, an effective alliance to fight against narco-trafficking, so that the war on drugs is not used as a pretext to dominate us, or to humiliate us, or to try to establish military bases. In our country they use the pretext of the fight against narco-trafficking.
I take use of this opportunity to say that, within this process of change, we want justice, that justice be carried out is important for our peoples, but I feel that via the Constituent Assembly we are going to decolonise the law in order to nationalise justice, real justice.
That the people implicated in the violations of human rights, peoples threaten with military interventions, there will never be justice there, we are obliged as presidents, as head of states to dignify humanity by ending impunity.
In the previous governments in my country, they massacred people that struggle for their economic demands, for their natural resources, and it is not possible that perpetuators of genocide, corrupt criminals, escape in order to live in the United States, in a developed country such as United States.
I ask with a great deal of respect, expel these perpetuators of genocide, criminals, corrupt ones that come to live here, if they have nothing to do with it, why don’t they defend themselves in the Bolivian justice system.
I am obliged, as president, to demand that these authorities be tried in the Bolivian justice system, and I believe that no country, no head of state can protect, hid, delinquents, the perpetuators of genocide.
Hopefully with the help of the North American people, hopefully via international organisations, the people that have done so much economic damage, damage to human rights, will be tried, given that they have never respected human rights.
I have a recommendation for the permanent forum of the indigenous peoples, in front of the debates about the rights of indigenous peoples, in front of the debates about the rights of indigenous peoples that are in the subcommission of the rights of indigenous peoples in the United Nations in Geneva, in the Organisation of American States, I have information that this debate has reached this maximum instance of the United Nations.
I want to ask you in the name of the indigenous peoples of the world, especially of Abyalala, now called America, to urgently approve this declaration of the rights of indigenous peoples of the world, the right to self-determination, the right to live in community, collectively, the right to live in solidarity, in reciprocity, and fundamentally the right to live in brotherhood.
There are regions were communities live without private property, there is collective property, the indigenous peoples only want to live well, not better, to live better is to exploit, is to loot, to rob, but to live well is to live in brotherhood and that is why it is very important, president, that the United Nations urgently after the decade of the indigenous peoples, that this declaration of the rights of the indigenous peoples, the right to natural resources, the right to look after the environment, be approved.
Finally president, the indigenous peoples, the poor come especially from a culture of life and not a culture of war, and this millennium will really have to be to defend live, to save humanity and if we want to save humanity we have the obligation to save the planet. The indigenous peoples live in harmony with mother earth, and not only in reciprocity, in solidarity, with human beings.
We feel greatly that the politics of hegemonist competitions are destroying the planet. I feel that all countries, social forces, international organisms are important, let us begin to debate truthfully, in order to save the planet, to save humanity.
This new millennium, the millennium that we find ourselves in needs to be a millennium of life, not of war, a millennium of people and not of empire, a millennium of justice and equality and that any economic policy needs to be orientated towards ending, of at least lessening these so-called asymmetric differences between one country and another country, those social inequalities.
We are not trying to implement policies that allow the economic humiliation or economic looting; when they cannot loot according to the norms, they use troops.
I want to ask with great respect, that it is important to withdraw troops from Iraq if we want to respect human rights, it is important to withdraw economic policies that allow the concentration of capital in only a few hands.
And for this, I feel president, that these events should be historical in order to change the world and to change economic models, interventionalist policies. Above all else we want them to be times that allow us to defend and save humanity
Popular Armed Defense Called for in Bolivia
La Paz September 21 (Granma).-- The Bolivian government has urged small farmers to take up arms if necessary in defense of the ongoing process of change occurring in the country since Evo Morales, the country's first indigenous president, took office in January of this year.
The government's move to recuperate the country's hydrocarbon reserves from foreign interests, new education and healthcare programs, an agrarian reform, and hopes that the currently convened Constituent Assembly will draft a new more inclusive constitution have been met with resistance from privileged sectors of society.
On Wednesday, acting President Alvaro Garcia addressed the need for the peasant population to be on guard when speaking in the town of Warisata during the commemoration of the third anniversary of the first six deaths of the killings ordered by former president Gonzalo Sanchez de Lozada to crack down on a social protest.
Garcia, who years back joined an armed indigenous group operating in the zone, said the rural population should be ready to defend the nationalization of Bolivia's hydrocarbons.
The vice president said that if necessary, they will take up the fight 50 or 60 times until the oil companies, speculators and criminal politicians that have plundered the country pay attention.
The call comes amid stepped-up conflict and pressure by conservative, regional and other opposition forces demanding that the Constituent Assembly decisions be made by a two-thirds vote.
Divided Mexico - Part 1: The Bankers' Alliance Holds on to Power
by John W. Warnock
For a brief time the media in Canada and the United States gave some
coverage to the July 2 election in Mexico. There was a threat from the
social democratic left - the possibility that Andres Manual Lopez Obrador
(AMLO) might emerge as the next president. The U.S. government, concerned
about the spread of the new socialism across Latin America, settled back
when the Mexican establishment carried the day. Nevertheless, the election
produced a major shift to the left, angered the poor and disenfranchised,
and heightened social divisions and political resistance.
Mexico was ruled by a succession of generals until President Lazaro Cardenas
(1934-40) restructured the Institutional Revolutionary Party (PRI). A
populist party, it included the trade unions, peasant organizations, a civic
alliance, and small business organizations. The PRI governed Mexico between
1929 and 2000 as a one-party state. Through the system known as
"Presidentialism," the PRI completely dominated. Elections were a farce as
the PRI won them all, legislatures rarely had any representation from other
parties, and the President appointed everyone, including his own successor.
In 1939 a group of right wing Catholics, business leaders and large land
owners formed the National Action Party (PAN) to defend the church, protect
private property rights, and to push for a government similar to Francisco
Franco's in Spain. They received strong support from the Mexican
Confederation of Employers (COPARMEX), whose slogan was "not class struggle
but class collaboration." The PAN provided token opposition to the PRI down
to the 1980s when it began to seriously contest local elections, demanding a
liberal democratic electoral regime.
Mexico has always been run by powerful wealthy families, foreign capital,
large landowners and the hierarchy of the Catholic church. The "bankers'
alliance," as they are known is Mexico, dominated the leadership and policy
of the PRI. It is commonly said that Mexico is run by 300 families.
Protected until the 1980s from competition from foreign firms, powerful
family groups have run the economy. In 2000 eight groups controlled around
70 percent of the stock on the Bolsa Mexicana de Valores. The most
influential organization has been the Mexican Council of Businessmen (CMHN),
37 of the richest men who in 1994 contributed $750 million to the PRI's
The first challenge to the bankers' alliance came in the 1988 presidential
election. When Carlos Salinas de Gortari was nominated to be the PRI
candidate, the moderate left wing caucus, the Democratic Current, left the
PRI and organized the National Democratic Front, an electoral alliance with
several small parties, the political left, and a broad range of popular and
community organizations, Mexico's "rainbow coalition." They supported
Cuauhtemoc Cardenas, the former PRI governor of Michoacan, for President.
The 1988 election was the biggest fraud in Mexican history. With 60 percent
of the votes counted, and Cardenas with a good lead, the PRI-controlled
Federal Electoral Commission (CFE) shut down the vote count; ten days later
they proclaimed that Salinas had won by a narrow plurality. It was Mexican
politics as usual. Salinas and his successor, Ernesto Zedillo, pursued the
neoliberal agenda of big business and embraced NAFTA.
The PRI's control over the Mexican political system was broken in 2000.
Vicente Fox, the candidate for the PAN, was elected president with 43
percent of the vote to 36 percent for the PRI's candidate and only 17
percent for Cardenas, now running for the Party of the Democratic Revolution
(PRD). With the introduction of a modified system of proportional election,
the PRI lost control of the Chamber of Deputies and the Senate, and
political pluralism emerged. But the bankers' alliance was not worried; Fox
was a businessmen and rancher, one of their own, and the PAN was solidly on
the political right.
The threat from the PRD
Lopez Obrador was elected as Head of Government of Mexico City in 2000.
AMLO, as he is known, was a history teacher from Tabasco, where he was an
active member of the PRI. In 1988 he joined the Democratic Current, left the
PRI, and backed Cardenas for president. In 1994 he ran for governor of
Tabasco for the PRD and lost in an election stolen by the PRI. He is known
for his strong support of the rights of indigenous peoples, his dedication
to fair elections and ending corruption, and a willingness to use civil
disobedience to confront injustice. As head of the government of Mexico City
he led a fight against crime, greatly reduced corruption, worked to help the
poor and introduced the first universal pension for seniors. When he left
office in 2005 public opinion polls reported he had an approval rating of
over 80 percent.
Other polls indicated that Mexicans wanted AMLO to be the next president.
While he is not a radical, he supported the broad coalition of peasant
organizations that asked for a renegotiation of NAFTA to exempt agriculture
and food. He advocates taxing corporations and the rich and using the
revenues to expand social programs in a fight against poverty and
inequality. Mexicans quickly became disillusioned with Vicente Fox and the
PAN, and in the mid term elections in 2003, only 40 percent bothered to
The bankers' alliance took up the challenge. The wealthy political elite in
the PRI began to work out a political agreement with the leadership of the
PAN. In 1989 the legislature had created the Federal Electoral Institute
(IFE), which earned the respect of the Mexican people for their commitment
to a clean electoral process. But this changed in November 2003 when the two
parties in the Chamber of Deputies appointed their allies to the nine-member
General Council. Nominations by the other parties to the Federal Judicial
Elections Tribunal (TEPJF), the highest electoral court, were also rejected.
The partisan nature of these two bodies was demonstrated in the 2006
In 2004 the PAN-PRI alliance stripped AMLO of his legislative immunity so
that he could be sued by a landowner for expropriating a piece of land to
build a road to a Mexico City hospital. This court action would have made
him ineligible to run for President. After a demonstration of over one
million supporters in Mexico City, President Fox abandoned the process.
Carlos Salinas, back in Mexico and deeply involved in building the PRI-PAN
alliance, helped to engineer a sting operation where several businessmen
made payments to two government officials in Mexico City to further their
construction projects. The transfer of cash was secretly filmed and then run
on television for months to demonstrate that the PRD was not free of
corruption. AMLO's support in the polls fell by 15 points.
The bankers' alliance directly entered the campaign. Aided by Dick Morris,
former adviser to Bill Clinton, they spent more than $19 million on
television ads; third party political advertisements are illegal under
Mexican law. The U.S. International Republican Institute, funded by the
National Endowment for Democracy, helped train PAN activists. Foreign
interference in an election is also a crime. PAN election spending far
exceeded the legal limits. President Fox spent six months campaigning for
Calderon, which is contrary to Mexican law. All these illegal activities
were recognized by the Federal Judicial Elections Tribunal, which concluded
that they did not have a significant effect on the outcome of the election.
Election results disputed
On July 2 around 60 percent of eligible voters went to the polls. The
results announced by IFE were as follows: Felipe Calderon, candidate for the
PAN, 36.38%; Lopez Obrador, 35.34% and Roberto Madrazo, the candidate of the
PRI, 21.57%. The margin of victory for Calderon was only 244,000 votes. No
major frauds were reported. However, many people went to the polls, found
they were not on the voters' list, were sent to special voting stations, and
found there were no ballots. This was especially the case in low income
areas where the PRD was strongest.
Going into the election, national polls indicated that AMLO had a lead of
around three percent. The two television networks, Televisa and TV Azteca,
did extensive exit polls which indicated that AMLO had won, but they did not
report the results. A large exit poll by the Instituto de Mercadotecnia y
Opinion showed AMLO had won, again not reported by the corporate media.
Academics who closely monitored the returns reported by IFE noted that
through most of the election night AMLO was ahead by a steady margin of
about three percent. Then, with around 70 percent of the vote counted, the
reports from the polls changed dramatically, with a five and then ten to one
margin going for Calderon up to the end. IFE officials claimed that this
discrepancy was due to the fact that rural votes came in last. But
Calderon's support was weakest in the rural areas. Shades of 1988.
Supporters of AMLO gathered by the hundreds of thousands in the zocalo of
Mexico City, demanding a complete recount. They camped there for weeks. A
poll by El Universal one of Mexico's major newspapers, revealed that 59
percent believe that there had been fraud. A poll in August found 48 percent
wanted a complete recount, while on 28 percent supported the announced
results. The New York Times and the Financial Times called for a recount in
order to establish the legitimacy of Calderon's apparent victory. But
President Fox, Calderon and the bankers alliance said "no!" They would ride
out the storm, as they did in 1988.
The PRD presented the Electoral Tribunal with 800 pages of documentation of
problems with the election. They challenged results in 72,000 of the 130,000
electoral districts, noting that there were major discrepancies between the
ballots delivered to polling stations, the votes counted at these stations,
and often between votes counted and numbers on the official voters' list. In
some areas the vote for Calderon exceeded the number on the voters' list.
They protested that officials at IFE had opened many of the sealed ballot
boxes after the election, which is against the law.
On August 5 the Electoral Tribunal dismissed the challenges from the PRD but
ordered a recount of 11,839 voting stations in 149 districts, covering
around 3.8 million voters. On August 28 they announced that they had
annulled ballot boxes which contained 237,000 votes, but insisted that this
had no effect on the outcome of the election. They refused to release any
details of the recount.
The PRD and its allies, the Workers Party (PT) and Convergencia, had
observers at all the recounts. They recorded the following from this sample:
* In 3,074 polling stations there were a total of 45,890 illegal votes,
above the number of recorded votes. This was primarily in PAN areas of
* in 4,368 polling stations a total of 80,392 ballots were missing.
If this sample was characteristic of the entire country, it would mean a
discrepancy of over 1.5 million votes, clearly enough to change the election
On September 5 the Federal Judicial Elections Tribunal finally declared
Calderon the winner of the election. The court noted the criticism of the
procedures on election day but argued that they did not have enough
information to conclude that this affected the election results. They
announced that the ballots would be burned, as in 1988, thus blocking an
independent recount requested by a group of academics and El Proceso news
But this is not 1988. Mass mobilizations have disrupted the political
establishment. More have been scheduled. A National Democratic Convention
was held in Mexico City on September 16, declaring AMLO the real president,
and appointing a commission to draft a plebiscite to call a new
The media focus on the presidency has obscured the fact that this election
has changed Mexican politics. The PRI was routed in the vote for president,
the elections for the legislature, and failed to carry a single state. The
PRD is now the second largest party in the legislature. If there had been a
run off vote for president, which is common in Latin America, AMLO would
have likely won, for the rank and file supporters of the PRI are peasants
and ordinary workers who hate the PAN. Even more than Fox, Calderon
represents the rich and powerful.
Political conflict is on the rise across Mexico. Miners are striking. A
national strike was held in February. Police killed two striking
steelworkers in Michoacan. Security police viciously attacked street venders
in the State of Mexico. Striking teachers and their supporters occupy the
centre of Oaxaca City, demanding the resignation of the Governor and have
created an alternate government. Police and military are again stepping up
the harassment of peasants in Chiapas. The general political trend across
Latin America has moved up to the Rio Grande.
John W. Warnock is a Regina political economist and author of The Other
Mexico: The North American Triangle Completed. He was a member of the
Canadian team of observers for the 1994 and 1997 Mexican federal elections.
In February 2006 he did research on the maquiladora zone industries in
Matamoros, Ciudad Juarez and Tijuana.
Mexico Part 2: Poverty, Inequality and NAFTA
September 27, 2006
There was very little coverage of the Mexican election in the North American
media this past July. But editorial opinion after the results were reported
was uniform: Andres Manual Lopez Obrador and the Party of the Democratic
Revolution (PRD) should shut up, accept their defeat and wait until the next
election. Nevertheless, a few newspapers did mention that the
president-elect Felipe Calderon of the National Action Party (PAN) would
have a difficult time dealing with a "deeply divided country" where around
50 percent of the population lives below the poverty line.
Wasn't the North American Free Trade Agreement supposed to fix this problem?
According to the World Bank, 50 percent of the population is living in
poverty and around one-fifth are living in "extreme poverty," with an income
of less than one U.S. dollar per day. This World Bank standard may be
relevant to some countries in Africa, but it is ridiculous to apply it to
Mexico where no one can survive on one dollar a day.
In 2002 the Mexican government introduced its own definition of poverty. It
distinguishes between rural and urban poverty. The three classification are
as follows, converted from Mexican pesos to U.S. dollars:
(1) Food-based poverty. Income is not enough to cover basic food expenses.
This includes 20 percent of the population. Individual income is $50 per
month in rural areas and $67 per month in urban areas.
(2) Capabilities poverty. Income is not enough to cover basic food, health,
and education. This includes 27 percent of the population. Individual income
is $60 per month in rural areas and $80 per month in urban areas.
(3) Basic needs poverty. Income is not enough to cover basic food, health,
education, clothing, housing and public transportation. This includes 50
percent of the population. Individual income is $95 per month in rural areas
and $137 in urban areas.
Poverty levels in Mexico City
The average household in Mexico has five members. In urban areas like Mexico
City, this standard family would be expected to survive on $685 per month.
This is the official basic needs poverty line.
These government classifications have been criticized by independent
scholars who put poverty levels considerably higher. For example, since 1978
the Centre for Multidisciplinary Analysis (CAM) of the Faculty of Economics
at the National Autonomous University of Mexico (UNAM) has been collecting
statistics on what is actually required to live in Mexico City. Their basic
needs basket is very limited: 35 items which includes food, toiletries,
public transportation, electricity, and gas for cooking. It excludes rent,
education, health, clothing, recreation and culture. While the government's
urban basic needs poverty level was set at $4.57 per day per person in 2002,
the actual costs of the CAM basket of goods alone was $28.82 per day.
In 2002 the minimum wage in the urban areas like Mexico City was $4.87 per
day. Because of inflation and devaluation of the Mexican peso in relation to
the U.S. dollar, between 1982 and 2002 the real value of the minimum wage
had fallen by 82 percent. During the presidency of Vicente Fox (2000-6) it
declined by 22 percent.
A study by Patricia Munoz of the Faculty of Economics at UNAM found that
"the minimum wage that entered into force on January 1, 2006 is only enough
to obtain 16 percent of what a worker could buy two decades ago with the
same salary." The minimum wage in Mexico "has suffered the largest, most
serious and drastic deterioration in all of Latin America."
Official government statistics report that 10.78 million Mexicans work for
the minimum wage or less, which is around 24 percent of those who have some
kind of employment. Forty one percent of workers earn the equivalent of two
minimum wages or less.
Finding a job
The average family in Mexico needs a number of sources of income to survive.
But the opportunities for employment are limited. Of the population of 106
million, around 44 million are considered to be actively involved in the
labour market. Of these, only around 20 million are in jobs that pay a wage
or a salary, and in 2004 only 45 percent of these workers were covered by
the contributory social insurance system.
According to government calculations, during the years of the presidency of
Vicente Fox, around 1.4 million workers entered the labour force each year.
However, the economy only created on average 524,000 new jobs per year over
this period. Thus 68 percent of new workers have had to survive in the
"informal economy," remain unemployed and dependent on their families, or
have fled to the United States. Around 1.3 million people work in the
During the period between 1961 and 1980 the average per capita real economic
growth in Mexico was 3.4 percent, higher than in either the United States or
Canada. The rate of inflation was very low, and the industrial sector of the
economy grew. So did formal employment and wages. At the time, the World
Bank and other institution described this as Mexico's "economic miracle."
But this changed with the world recession of the early 1980s and the
collapse of the price of oil. The Reagan-Thatcher free market and free trade
model was forced on Mexico. Between 1981 and 1990 the average real rate of
economic growth fell to -0.3 percent and rose only to 1.9 percent between
While other middle income countries, like Hong Kong, South Korea, Taiwan and
Singapore have been steadily narrowing the gap between their wages and those
of the United states, this has not been true of Mexico. For example, in 1975
manufacturing wages in Mexico were 23 percent of those in the United States;
this fell to 11.5 percent in 2001.
A study by Enrique Dussel Peters of the Faculty of Economics at UNAM found
that between 1988 and 2001 those industries that were most affected by the
trade liberalization policies represented by NAFTA showed a downward trend
in real wages but had the highest rate of productivity increases. Employers
in the export industries were getting much more out of their workers while
paying them less in wages and benefits.
Nevertheless, with the internationalization of production, and the open
economy, the major companies are shifting work out of Mexico. For example,
the average wage for electronics workers in Guadalajara in 2004 was $US1.80
per hour; in Shenzhen, one of the high wage areas in China, it was $US0.77
per hour. Workers in the maquiladora factories in the border zones in Mexico
complain that the shift in production to Asia and Central America has led to
a downward pressure on wages during the Fox presidency.
Persistence of inequality
Official government figures show that between 1963 and 1985 inequality
steadily declined. With the onset of the "lost decade" of the economy and
the shift to the policies of neoliberalism, inequality again began to
worsen. Some improvement has been seen since this low point. But in 2005 the
top 10 percent of households averaged an income of $US4,261 per month; the
bottom 10 percent of households averaged US$166 per month.
The U.N. Economic Commission for Latin America and the Caribbean points out
that Mexico, a middle income country, "competes with other Latin American
countries for the first places on economic, social and gender inequality."
Very powerful business organizations preside over a hierarchical class and
social system. Mexico is also described as a "pigmentocracy," for those
families at the top stress their "whiteness" and Spanish blood while those
at the bottom of the social hierarchy are the dark skinned indigenous
peoples, who are also the poorest.
The Mexican government has introduced a new anti-poverty program,
Progresa-Oportunidades, which is targeted to those living in extreme
poverty. With a budget of $2.8 billion, it provides financial support for
school supplies, expanded health services, and a payment of around $US15 per
month to women for the purchase of food. By 2005 it provided cash subsidies
to around five million families, or 24 percent of the total population. The
program has faltered under President Fox.
One of the most serious obstacles to combating poverty is the fact that all
Mexican governments have hesitated to impose taxes on corporations, wealth
and those in higher income brackets. Between 1988 and 2002 social
expenditures dropped as a percentage of gross domestic product from 11
percent to two percent. Government spending in general accounts for less
than 20 percent of Mexico's gross domestic production, compared to over 40
percent in the developed countries.
The most important contribution to the reduction of poverty in Mexico is the
remittance of earnings from family members working in the United States. The
Mexican government reports that there are nine million Mexicans living and
working in the USA; this increased by 2.5 million during the presidency of
Vicente Fox. They are now remitting over $20 billion annually, most
important to low income families.
Felipe Calderon has proclaimed that he will make the reduction of poverty
and inequality the primary aim of his new government. Mexicans do not expect
much to change. The structure of the economy will not change. The general
policy shift away from serving the domestic market and emphasizing exports
has led to lower rates of economic growth, relatively lower wages, the
creation of few jobs, and increased inequality. Across Latin American
similar trends have promoted the shift to the political left. Mexico is no
John W. Warnock is a Regina political economist and author of The Other
Mexico: The North American Triangle Completed. He was a member of the
Canadian team of observers for the 1994 and 1997 Mexican federal elections.
In February 2006 he did research on the maquiladora zone industries in
Matamoros, Ciudad Juarez and Tijuana.
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