By Kathleen Bohne
Below you will find an excerpt from the September 12 edition of “La Semana” newsletter. To read the complete article and subscribe, please visit www.themexpatriate.com
“We can say that in Mexico the oligarchy no longer prevails, but rather the poor are prioritized, corruption is not tolerated, nor is impunity, there is no decadence in the government and public servants act efficiently.”
According to President López Obrador’s fourth annual report given on September 1, the promises of “la cuarta transformación” have been fulfilled. While it is customary for heads of state to aggrandize their accomplishments in such addresses, AMLO’s triumphant discourse seemed to describe an imaginary country. “No somos iguales” (“we are not the same”) was the slogan used in brief video messages broadcast by the president in the lead-up to the annual report, emphasizing the contrasts between his administration and his predecessors’. Aside from doubting this choice of words in the context of a highly unequal country, the statement begs the question: how have things changed?
Corruption, which in AMLO’s rhetoric is synonymous with neo-liberalism, has been presented as Mexico’s arch-nemesis, and it is difficult to argue the contrary. The insidious effects of corruption, defined as “the use of entrusted power for private gain”, can be identified in so many aspects of Mexican life, a source of much of the cynicism and anger with Mexican institutions. The scandals that rocked the Peña Nieto administration provided rich fodder for Morena and AMLO’s campaign to rid the country of a predatory political class intent on enriching itself while betraying the interests of ordinary Mexicans. “Corrupción” is one of the most oft-used words in his mañaneras and has become a catch-all for not only past sins, but present critics.
If Mexico were Middle Earth (bear with me), the ring of power would be corruption itself and in AMLO’s retelling, he would be Frodo, casting it into the fires of Mount Doom. The trouble with corruption is that unlike the ring, its power cannot be destroyed by one brave hobbit (or tabasqueño).
As part of his strategy to end corruption, AMLO and his attorney general, Alejandro Gertz Manero, have pursued some of the most notorious figures of the Peña Nieto era, including Emilio Lozoya, the ex-director of Pemex, and Rosario Robles, ex-director of the Sedesol (Department of Social Development). Both were implicated in the “estafa maestra” or “master scam”, a fraud of 7.6 billion pesos involving 11 government agencies. And neither one has been tried yet.
Robles was remanded to prison in August 2019, charged with abuse of public office. She was released on August 19 of this year after numerous petitions to the judge to allow her freedom pending trial. Lozoya—who has also been charged with accepting money from Odebrecht, the Brazilian construction company that spun a web of bribery across Latin America over thirty years—was granted an “amparo” or appeal to review his pre-trial detention last week. He has been in prison since November 2021 and his lawyers are attempting to negotiate another deal with the attorney general’s office (he was already a state witness). Lozoya and his family are implicated in receiving up to $10 million US, funds which were supposed to grease Odebrecht’s path to contracts with Peña Nieto’s government but which the FGR (attorney general’s office) investigation found were kept for personal use.
Aside from these high-profile cases, what has been done to eradicate corruption since AMLO took office? Is there any notable change? His opponents emphatically proclaim “no”—pointing to the lack of convictions in these cases, as well as a lack of transparency within this administration. Public contracts have continued the same trend as during Peña Nieto’s administration, awarded directly more often than via public bid (80.3% of contracts and 38.1% of public funds in 2021), which is considered a risk factor for corruption.
However, according to the ASF (Federal Audit Office), there has been a dramatic 56% reduction in irregularities detected in municipal and state spending from 2018-20. The exact mechanisms that have led to this improvement are difficult to identify. In an article by analyst Viridiana Ríos, she points out that some entities and areas that had previously shown signs of corruption may be getting audited less, while those with cleaner records are getting more thorough audits. And what happens when possible fraud is detected? So far, no criminal charges have been filed for any public spending irregularities found since 2019. “The amount of money that is audited should not be celebrated, nor the number of audits or number of irregularities that are found. What matters is the number of public officials who face legal action for irregularities that have not been cleared up.”While AMLO has promoted the concept of governmental austerity as part of the anti-corruption crusade, in practice this has looked more like redistribution and centralization than budget-cutting. Some of the biggest beneficiaries thus far have been state-owned companies, Pemex and the CFE (Federal Electricity Commission), which also have a long track record of corruption. Pemex received state subsidies and stimulus worth 792 billion pesos from January 2019 to June 2022 (1.6 times more than the Department of Health in the same period). In the projected 2023 federal budget just presented last week, Pemex will receive 6.6% more funding than in 2022 while CFE funding will drop 2.3%. Meanwhile, budgets for regulatory agencies in the energy sector (CRE and CNH) have dropped or been stagnant during this sexenio.
