My Thoughts On AMLO And The Upcoming Mexican Elections

mexicoelections

Mexican elections are coming up on July 1st, 2018.

In my opinion, all the candidates are shit.

I feel bad for the Mexican people.

You've got José Antonio Meade. He's part of the PRI party that currently holds power. PRI's got a terrible reputation now, so he had no fucking chance from the get-go.

You've got Ricardo Anaya of the PAN party (conservative; business-friendly). Folks don't much like PAN now either - they ruled the country from 2000-2012 and saw low growth as well as an uptick in violence.

And the you have Andrés Manuel López Obrador (AMLO), the leftist candidate. His Morena party has never been in power on a national level, so no one can criticize them for doing a bad job.

He's expected to win the election.

Now, I mentioned that I think all the candidates are shit.

Here's why.

...they have no concrete proposals!

It's quite amusing - not one of the candidates has clarified in any meaningful way how they are going to tackle the country's most pressing issues.

AMLO has suggested amnesty for drug criminals in an effort to ease violence in the country, but hasn't explained what that means.

Anaya has promised to implement a universal basic income for Mexican citizens, but hasn't said where that money's going to come from or how exactly it'll help the economy.

Meade hilariously proposed to create a "national registry of the needs of every person" to sort out how best to allocate scholarships, loans for small business, medicines, etc. A task of such epic proportion that it will never get done.

At the end of the day, though, it doesn't matter that no candidate has sound proposals.

People are sick of the ruling parties they see as corrupt and incompetent. It's the perfect time for a third candidate to gain support by appealing to the poor, disenfranchised and/or liberal-progressive Mexicans who want change.

Bring in AMLO!

 

 

 

Who Is AMLO?

I'll break this down as quick and simply as possible.

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AMLO is a leftist candidate - a populist, basically - who's been in politics for a long time. He actually began his career as a member of the PRI party, the party that everyone sees as corrupt and incompetent, but that isn't brought up too much among his supporters.

He ran for president in 2006, lost by a narrow margin and claimed fraud, encouraging his supporters to take to the streets. He even went as far as to refer to himself as the President of Mexico in a subsequent interview with Univision.

Bold!

I'm not saying this to insult AMLO - there certainly could have been election-fraud. It's Mexico. Election fraud happens.

Just giving ya'll some background.

Anyway, he ran again in 2012. He lost again, this time by a larger margin, and again he claimed fraud.

I'm not so sure about that one...

But now, in 2018, the other parties have stepped on their dicks so much that AMLO seems like a good option. He's pandering quite hard to the poor, promising to protect Mexican agriculture, freeze oil prices, increase public spending and jack up the minimum wage.

 

 

 

What Worries Me About AMLO

AMLO is a socialist. No other way to put it. 

Historically, socialism hasn't worked out so well in Latin America. And his talk about protectionism, freezing oil prices and more state ownership makes it hard not to think of, well, you-know-who... (Chavez, if you don't).

But, it's not all bad. AMLO was mayor of Mexico City for a time and, by all accounts, he did a bang-up fucking job.

Will that translate to a national level? Well, it's anyone's guess.

From what I've observed during the lead-up to the elections, AMLO is the most inconsistent candidate. One day he cozies up to the business community, saying that he'll encourage foreign investment, and the next, he goes on a tirade against them, claiming that they're all corrupt and robbing Mexico and the Mexican people.

In short, investors don't know what to do. One minute, they think he's OK and the next he scares 'em off with his rhetoric. Unsurprisingly, the Mexican peso has suffered at the likely prospect of an AMLO victory.

But the shit that scares me the most is that he refuses to condemn the Maduro regime in Venezuela. Something that, at this point, should be a no-brainer.

I mean, no, you don't have to disavow things that don't have to do with you or your campaign, but Jesus Christ, why the fuck wouldn't you?

It's a legitimate regional concern.

In short, best case scenario AMLO turns out like Lula in Brazil, who was left, but played ball with foreign investors.

Worse case, he turns out like Hugo Chavez.

From where I'm sitting, he presents by far the greatest risk to Mexico at worst, and a slight positive at best.

I'll explain what I mean by the latter.

 

 

 

Some Hard Fucking Truths

Mexicans are gonna hate me for this one!

But ya'll need to hear some hard fucking truths.

 

1. Your country cannot be self-sufficient - these days, scarcely any country can (see point 4 below).

 

2. Criminality will continue to be a problem.

Amnesty for narcos?

Sounds good, but what do you reckon will happen? All these hardened killers are just going to become chefs, bank tellers and carpenters?

Hah!

The best you can hope for is what was going on with PRI before the drug wars started: a live and let live policy with drug cartels. Which will certainly require Mexican politicians to use their influence to prop up one cartel over the others, so the others are too weak to compete for plazas.

So, in other words, that good ol' corruption that AMLO promised to get rid of.

 

3. You will not root out corruption.

Hundreds upon hundreds of years of corruption. It is deep seeded. It's part of the fucking culture.

Hate me for saying that but prove me wrong.

AMLO is not going to undo it in 6 years.

Best case scenario is that AMLO increases the living standard for the poor at the expense of the middle class while the rich stay rich.

Corruption will not decrease. 

Worst case scenario, he makes EVERYBODY poor.

 

4. In terms of free trade, you will get fucked over. But, if you go all protectionist, you'll get fucked over much worse.

An argument could be made that Mexico gets the short end of the stick when it comes to NAFTA. And, with the ongoing NAFTA negotiations, any new deal reached will likely be worse for Mexico than the previous terms.

But guess what? 

Cold world.

Shit is going to get a whole lot fucking worse if Mexico rejects NAFTA, goes full-on trade war with the USA and attempts to manufacture and produce all of its own shit.

Guys, you have a problem with your education system that you need to address before you can hope to accomplish this kind of thing.

Mexican workers are barely more productive than they were a decade ago

Nepotism is the way this country works. Dumb but rich kids go to Tec de Monterrey or Ibero, get good jobs in which they are responsible for 100s of employees and don't know what the fuck they're doing because they've never even coordinated doing their own laundry or going grocery shopping.

It's no fucking mystery why Mexican workers aren't productive.

I see this with friends (God bless them). They'll complain about how they have to "work" 11 hours a day, but they take 2.5 hour lunch breaks, talk on WhatsApp and share memes on Facebook the ENTIRE fucking time.

Ya'll need to hear this.

You are not ready to be a self-sufficient country yet. You still need external help. Maybe if you can fix your domestic problems you can transition more toward it - and it's possible AMLO can help begin this process - but if he tries to shut down trade and investment during his term, it will be PAINFUL.

 

5. Mexicans underestimate how much of the economy depends on external factors.

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As a country that relies heavily on oil exports, as well as regular ol' trade with the United States, many Mexicans don't realize how much of the Mexican economy relies on factors outside of their border.

For instance, current president Peña Nieto of the PRI party constantly gets blamed for the crash of the Mexican peso during his term.

What people neglect to mention is that Nieto had to deal with a global collapse of oil prices as well as the Trump campaign, during which the peso lost 14% of its value.

And, because Nieto happens to still be the president, people are even trying to blame him for the peso's most recent slide, a phenomenon that solely has to do with investor fear over the next president of Mexico.

This lady even tries to blame PAN as well! 

Simply put, Mexico's economy relies on a lot of shit that is simply out of its control. This is due to its exports, as well as its geographical location. Mexicans might not like that, but it hardly matters, because that's the way it is!

Again, AMLO can put Mexico on the path of being more self-sufficient, but what he can't do is discourage trade during his time in office. This kind of transition takes time. A lot, a lot of time.

And ya'll haven't even started yet.

 

 

 

Conclusion

I'll lay it down straight for you.

AMLO will not be your saviour. Like I said before, he will either make things much, much worse for everyone, or slightly better for poor people.

And, as I said before, best case scenario, he's like Lula: he helps the poor while still encouraging foreign investment.

But even with Lula, shit got better because many emerging economies experienced unprecedented growth during his tenure. Everyone was trying to get a piece of them BRICS economies. He also enjoyed a boom in commodity prices.

Only toward the end of his term did things start to cool down.

As soon as he stepped out of office, investment dropped off and, what do you know, an economic crisis occurred.

Dude got in when things were good globally, and made off like a bandit just before things got bad.

Sure, he did some alright things; was quite clever about allocating public spending, but above all he got the credit for a strong economy that was driven primarily by external demand.

This is how things work for developing economies, guys.

Love it or leave it (most who can, do, in fact, leave it).

AMLO will probably win. And Mexico will probably stay the same or get worse.

Maybe I'll eat my words in a few years, but I have a strange feeling I won't.

 

Until next time,

Vance