Mexico & Nafta - December 2006 (ISSN 1741-444X)

Felipe Calderón Hinojosa, the president-elect, made his first six cabinet appointments, naming his economic ministers, on 21 November. On 24 November he followed this by naming the six ministers who will run the spending ministries in his government. As we went to press, on 27 November he was due to name his law enforcement, security and foreign policy team. Calderón takes office on 1 December.  

Both tranches of ministers had unifying themes. The economic ministers are all privately-educated technocrats. The spending ministers were all members of Calderón's Partido Acción Nacional.

The economic ministers also share the quality of having close personal links to Calderón. Two, Agustí­n Carstens, the new finance minister, and Luis Tellez, the new telecommunications minister, were Calderón's classmates at Mexico's most prestigious private university, the Instituto Tecnológico Autónomo de México (ITAM). The surprise appointment, Georgina Kessel, also has an ITAM connection. She taught at ITAM when Calderón did his master's degree in economics. Her current job is head of the mint (Casa de Moneda).  

Calderón has also appointed another old classmate, this time from law school, Javier Lozano, as labour minister, while Rodolfo Elizondo, who continues as tourism minister, is an old political friend and one of the few members of Fox's cabinet to back, publicly, Calderón's campaign for the presidential nomination for the PAN. Fox and his men had wanted Santiago Creel, his interior minister, now a senator, to be the PAN's presidential candidate. Eduardo Sojo, who moves from the nebulous job of being the cabinet minister responsible for public policy to running the economy ministry, and thus in charge of all trade negotiations, is also an old friend of the president-elect's.  

Kessel's appointment is the most surprising and interesting. She has a low profile, though people who have worked with her say that she is more than competent. Her appointment suggests, however, that President Calderón will not push for a major reform of the energy sector. She has little experience of negotiating with congress: if the state oil company is to be reformed, congress will have to be convinced that what the government is proposing is appropriate.  

What makes Kessel's appointment doubly odd is that Luis Tellez was energy minister in the second half of the last Partido Revolucionario Institucional government of President Ernesto Zedillo (1994 to 2000). As a former prií­sta, and chief of staff to President Zedillo, Tellez would seem to be better placed to negotiate reforms with congress where the PAN does not have a majority.

Kessel is primarily an academic, though she has also advised the chairman of the anti-trust agency and worked on the Plan Puebla Panama. This was President Fox's great scheme to accelerate the development of southern Mexico and Central America. Kessel was also the first female president of the Comisión Reguladora de Energia. Despite the title, this job was more about managing the regulation of the energy market than about energy policy.

Some well informed commentators in Mexico say her appointment suggests that Calderón may be thinking of winding up the energy ministry. This is the only cabinet job he himself has done. The suggestion is that the energy ministry will be converted into a regulatory organisation and more power will be given to the operating companies (all state owned): Petróleos Mexicanos; the Comisión Federal de Electricidad and the Compañia de Luz y Fuerza.  

The leftwing opposition, the Partido de la Revolución Democrática (PRD) was dismissive of the economic appointments. José Guadalupe Acosta Naranjo, the PRD's secretary general, said that some of the appointments were "repayments of campaign debts." The PRD claims that big Mexican companies, which backed Calderón, such as Telmex and Citigroup's subsidiary Banamex, will now have a major say in economic policymaking.  

Tellez, in particular, is accused of having helped the banks with public money following the banking crisis at the beginning of Zedillo's administration. Others say that the appointment of Tellez is a signal that Calderón is serious about weakening Telmex's grip on the telecommunications market.

Tellez has had a varied career. One of his early jobs was as deputy agriculture minister where he helped to push through the constitutional reform to Article 27. This ended the primacy of the ejido, the communal landownership scheme set up by Mexico's greatest 20th Century president, Lázaro Cárdenas.  

After Kessel, the most interesting appointment is probably Lozano, the new labour minister. He is another former prií­sta who served for a year as director general of the Comisión Federal de Telecomunicaciones, the telecoms regulator. His career in the PRI stalled when the party was defeated in 2000: he had expected to get into congress, instead he had to set up a consultancy. He was one of the first prií­stas to defect to Calderón, long before Calderón was thought to have any chance of winning the PAN nomination, let alone the presidency. Lozano likes cutting deals so may well be able to push through a labour reform, another piece of unfinished business bequeathed by President Vicente Fox. The rumour in Mexico City is that both Telmex and Televisa, the two key companies in the broadcasting and telecoms industry, opposed his nomination as communications minister.

The spending ministers

The most interesting appointment of the six ministers chosen to run the spending ministries is Josefina Vázquez Mota as education minister. Elba Esther Gordillo, the ambitious head of the teachers union, the Sindicato Nacional del Trabajadores de la Educación (SNTE), had expected to have veto over who would be the new education minister. Calderón, however, asserted himself, putting himself on a collision course with Gordillo, the SNTE and her Nueva Alianza which has a crucial nine members of the lower chamber of congress in which Calderón's PAN does not have a majority.  

Gordillo's henchman, Rafael Ochoa, the secretary general of the SNTE, claimed that Vázquez Mota had only been awarded the education ministry as a consolation prize because of infighting in the Calderón team. Vázquez Mota shook up Calderón's campaign at the beginning of the year and steered him to victory. She had been in charge of anti-poverty programmes, as social development minister, in the Fox administration. She has, as Ochoa pointed out, no connections with education.  

In Calderón's government, Vázquez Mota's old job, social development minister, and thus responsibility for the key Oportunidades programme, goes to Beatriz Zavala, now a senator but previously a former president of the social development committee in the lower chamber of congress. The former governor of Jalisco, Alberto Alberto Cárdenas Jiménez, becomes minister of agriculture, rural development and food. José Ángel Córdova Villalobos, another former congressman, becomes health minister. Abelardo Escobar Prieto carries on in the cabinet as agriculture reform minister. José Luis Luege Tamargo, also continues as environment minister. Calderón is due to announce his law and order and foreign ministers on 27 November. Francisco Ramí­rez Acuña, a controversial and authoritarian governor of Jalisco, is expected to become interior minister.

López Obrador: The defeated candidate in the presidential election, Andrés Manuel López Obrador, declared himself "legitimate president" on 20 November. López Obrador, who lost narrowly to president-elect Felipe Calderón Hinjosoa in the 2 July elections, claimed that the result of the election was fraudulent. His supporters claimed that over 1m people packed the Zócalo for the ceremony. Independent observers doubt that there were many more than 100,000. What is clear is that López Obrador drew fewer people to his inauguration than to his initial protests, in the summer, against the elections.

The ceremony was showy, with icons of the Left such as students and indigenous people well represented. López Obrador has taken as his symbol the open-winged eagle of President Benito Juárez, the great nineteenth century president of Mexico. López Obrador claimed that "democracy is the people, for the people and with the people". He accused "a neo-fascist conspiracy" of depriving him of victory in the elections. The Partido Revolucionario Institucional indirectly endorsed some of the points López Obrador made when its leader in the lower house of congress, Emilio Gamboa, suggested that President Vicente Fox should not attend the inauguration of his successor. Gamboa said that without Fox the ceremony was likely to have fewer protests. Fox has already been unable to deliver his final state of the union address to congress (on 1 September) and was forced to deliver the traditional independence "grito" in Hidalgo rather than Mexico City on 15 September because of protests by López Obrador supporters.  

Poll

According to a poll in Reforma, 56% of Mexicans oppose López Obrador's decision to declare himself "legitimate president" and 61% say that this move will damage the country. What should be worrying for López Obrador is that only 19% support his move and only 16% think that the self-proclamation stunt will benefit the country. A thumping 20% don't care and 17% view the self proclamation as "irrelevant." Only 11% of Mexicans, according to an opinion poll in late November, believe that any attempts to thwart the inauguration of Calderón are warranted.  

*reappointment from Fox's cabinet ** moved from another cabinet position

Calderón reins in the finance ministry

The new finance minister, Agustí­n Carstens, did not get to pick his lieutenants. The rumour is that Carstens wanted Alejandro Warner to be his deputy minister responsible for spending. Calderón imposed one of his close colleagues, Ernesto Cordero, into that job. The appointment is significant because Carstens has been warning that the 2007 budget will be tight. Cordero will settle spending priorities.  

Cordero, like Calderón, is a long-serving Panista. Cordero was head of planning at the energy ministry when Calderón was, briefly, energy minister.  

Werner will now be responsible for revenue raising. Like Cartens himself, Werner has served in the Banco de México and at the IMF. His brother, Martí­n, was a deputy finance minister during the Zedillo government. Martí­n Werner is currently a managing director at Goldman Sachs.