A New Hope for Mexico?- an Interview with Sergio Silva-Castañeda

The Mexican elections of 2018 saw an unprecedented victory for the left, with the election of Andres Manuel López Obrador as President (winning 31 of 32 Mexican states), and with his MORENA party [the Movimiento Regeneración Nacional] sweeping away the old parties of the PRI and PAN, and achieving an absolute majority in the Chamber of Deputies. At a time when the left has been on the retreat in many parts of Latin America, AMLO’s victory represents (to take the English-language title of his 2018 book) a New Hope for Mexico, and the chance to reconfigure a political society blighted by corruption and inequality. On a recent trip to CDMX, Renewal commissioning editor Martin O’Neill spoke with Sergio Silva-Castañeda about the ambitions and prospects of the new Mexican government. Sergio Silva-Castañeda was until 2018 a professor of international studies at ITAM in Mexico City, and now serves as a member of the new administration, as economic adviser to Graciela Márquez Colín, Secretary for the Economy in the new government.

Martin:    Thanks so much for finding the time to meet up. I can only imagine how busy you are. Now, Sergio, you were saying that you and your friends had thought you were always going to be in opposition. You never thought there’d be a moment like this where the left would really break through in Mexico?

Sergio:     To be honest, even though the polls were clearly in our favour for months and months, I couldn’t start believing it until I saw the outcome on election night. Before that, I mean, this is Mexico… You can’t expect such an outcome!

Martin:      Obviously in Britain, we had an election in 2017 where the outcome was to most people extremely unexpected. The conventional wisdom, going into that election, was that this left-led Labour Party, the Jeremy Corbyn Labour Party, were going to go down to a huge defeat, and that would be the end of that kind of left politics in Britain for a long time.

It turned out that the conventional story was wrong. Instead, events turned out quite differently, with an election that went much better than we expected, and there remains a lot of hope in Britain that there is strong, bright future for radical left politics, whatever the difficulties along the way.

So, the question that we on the British left would want to ask you in Mexico, in a country that’s never elected a left president before López Obrador, is a simple one: how was it done? How was MORENA able to have this amazing breakthrough? How would you explain it to people outside of Mexico?

Sergio:      That’s a very hard question. But I would say part of it is this government and the previous two governments were a complete disaster. And with the failure of this government, you have the failure of two political opponents.

One on the centre to the right, Partido Acción Nacional [PAN]. That’s Presidents Calderón [2006-12] and Fox [2006-12]. And then you have the PRI [the Partido Revolucionario Institucional, the party of President Peña Nieto (2012-18), and previously the party that held power in Mexico since the 1920s]. That’s a very old party that historically, in ideological terms, has been very flexible. If you see all the PRI governments of Mexico, you would see some of them flirting with the left. Some of them move to the right. That would explain why they were in power for 70 years and how they managed to come back after two PAN administrations in 2012.

But the presidency of Peña Nieto was a complete disaster by almost any single measure. It was the perfect time to try to beat them because they were completely knocked down. So it was a historical opportunity because those parties that are usually very competitive, they were knocked out. And on top of that there were huge divisions inside those parties.

It was very hard to imagine a left wing option within Mexico, but it was the time. It was the opportunity.

Martin:         It was now or never?

Sergio:         Yes. I think so.

Martin:         I’m very interested to hear about the group that you’re in, Democracia Deliberada. As I understand things this is a political group where many of you come from academic backgrounds. Democracia Deliberada talks of its mission in terms of looking to reclaim a lost left (la izquierda perdida). A number of of you have now moved into the new MORENA government going. So can you tell me about that formation and your role within it? Is it about trying to give more ideological shape to the MORENA project?

Sergio:          Six years ago, when Peña Nieto was elected, many of us thought that, the PRD, the last left wing party then, was going to enter into a very big transition period after losing that election. We already knew they were going to lose and we thought that maybe now after this they would need to go through a very deep transformation. And we were hoping that that transformation was going to move the party to the left.

Many of us have been into politics forever. Some of our members actually worked in the 2006 campaign with Andres Manuel [López Obrador]. Some of us were academics. Some of us were activists in different kinds of organisations. I was still at Harvard. I came back to Mexico three days before that election.

I knew some of the group already. We started organising meetings every Tuesday. And the idea was, we want to contribute to the PRD by trying to move and deepen the debate. To tackle the old topics, you know? Inequality, poverty… What we should be discussing in terms of policy. And that’s what we started doing. We start meeting every week after the 2012 election.

The idea is to have an open deliberation on topics of policy: for example, in terms of drug policy, what should be our position? And in terms of this social policy of this government, what’s our position? Our sessions are open. Anyone who wants to go there and participate in the debate, it is completely free to come.

Everything is debated and we publish all the positions that have been agreed among everyone. Sometimes we agree with many details, so we have a more detailed position. Sometimes we have to limit a position to a very general level. When the debate about minimum wages in Mexico started, instead of having just one publication about it we did three, because now we agreed every single detail. We wanted to make the whole argument from every single angle. We spent our time saying why we want this. The case for the minimal wage to be increased significantly.

Martin:           With the proposed increase in the minimum wage, is that going to be the main policy for trying to reduce inequality in Mexico? How does that fit into a broader strategy for trying to reduce the very high levels of inequality that you have in Mexico?

Sergio:          I think if that were to be our only policy, that would be one that will be enough to make a large difference. The main problem with minimum wages in Mexico is that they are so low, that you really have to increase them a lot for them to give something back.

Martin:          When I read AMLO’s book, which just recently came out in English, I was amazed to realise quite how low the minimum wage is in Mexico, as there’s been no effort over the years to adjust it in line with inflation. In effect it’s fallen to almost nothing.

Sergio:          It’s completely ridiculous. And we think that has an effect on all the other levels of wages throughout the economy.

Martin:          One thing that struck me about reading AMLO’s book in English was the centrality of the idea of having a change in the moral culture, finding a way to kind of move beyond a culture that allows corruption in public procurement, trying to get beyond this kind of extractive model. This emphasis on public values seems important, but I didn’t have enough of a sense of how that’s going to be done. How that could be achieved? How do you use the levers of government to start to change the values of a political culture?

Sergio:           Something progressives around the world share is the idea that you can use the state as a tool to fix things, right? The problem in Mexico is that the level of corruption is basically so high that that tool is kind of useless. We need to clean it first. So that we can actually use the state as a tool for the purpose that we have in mind. And I think that’s one of the merits of AMLO is that he sees that very clearly. If we do not control the level of corruption we won’t be able to do anything else.

For me it’s more about the rules and the punishment. Corruption is so widespread in Mexico. Like it’s normal, everyone does it, you know? I think if you’re unable to overcome that all the rules, all the regulation, everything you want to do it’s going to fail.

Martin:        You put that in a very strong way to talk about needing to clean the mechanisms of the state first in order for the state to be able to function to realise progressive outcomes. But even if one agreed with the analysis that this is in some ways a moral problem, a problem of political culture, then one approach, as you suggest, is to change the costs and the incentives, to think about rules and punishments. But that seemed less clear in AMLO’s book. What is his idea? Is it that you just have a kind of moral leadership from the centre and that changes the culture? But what do you need to do really to change how people think about the state, and state spending, and how they approach state contracts? It seems to be a huge, huge challenge.

Sergio:        I think, it’s hard for me to say this because my instinct as an academic is to go in a different direction, but I do think that who is who in the world matters. And that’s something that is changing dramatically. No one of the team we’re working on is there because we’re just waiting for the right moment to be rich. We’re coming from a very different background, we’re not thinking about the great life we’re going to have because we’re going to have a driver. We take public transportation and that’s just normal. I think that’s a good start. That someone can get rotten while they have the temptation, yeah that can happen. But we have a different country, a different environment. Whoever does that, everyone else will get mad. It’s not going to be normal. And I think that’s a good change.

Martin:        After the democratic transition. Mexico had more decentralisation. More power went to the States.  Does the kind of change in the moral conduct of politics that you’re talking about here necessitate a greater degree of political centralization? Does it mean the central administration has to do more to invigilate the way that money gets spent at the sub-national level, and in regional government?

Sergio:       I think there will be more centralization and more control over the resources of the federal government. There is nothing we can do about the resources of the states. That will be going against the Constitution. That’s not a good idea.

Martin:       Am I right in thinking that, in terms of the fiscal system in Mexico, taxes get collected by the federal government and then disbursed to the states?

Sergio:        Personally, I think that’s a problem, but I don’t think it’s going to change, frankly, not because of the federal government, because of the states. It’s much easier not to have any fiscal duties, you know. They don’t have to task political capital to collect taxes and they get their share of the expenses. So I don’t think that’s going to change.

Martin:        In a period where we see what’s happening in Brazil, and it’s so depressing to see a country go that direction, Mexico’ has become a great hope for the global left …

Sergio:         No pressure. (laughs)

Martin:        So, big difficult question. What do you think is most distinctive about the political project on which you’re embarking in Mexico, and what is it that you want people on the left in other countries to know about this project? What’s most distinctive about what you’re trying to achieve here?

Sergio:         That’s a hard question. The first thing I would say is that this what we are doing is not actually all that left wing. What I’m saying is I think that’s important for everyone else to know is that the whole campaign and movement was built in a very pragmatic way. When you’re pragmatic, you need to make compromises, and there are compromises. So I don’t think we’re going to have a very radical left government, but still we’ll be on the left in terms of our priorities, in terms of how we completely restructure the way the Mexican state spends money. I think the priorities are clear. I know some people on the left are going to be a little bit disappointed in this, but this is the kind of left government that is possible in Mexico. If we had to move a little farther to the left, it would be impossible to win.

I think people on the left in all sorts of other countries would be delighted to see Mexico, a country of 120 million people, move to a state where it had lower inequality, lower levels of poverty, where it was on the path to be a more equal society. Those are the priorities. But do not expect a radical movement towards these priorities.

We will have a very responsible fiscal policy. I don’t think we’re going to be incurring any kind of deficit, but mainly because I don’t think we need to. As long as you’ve got all the wasted money that was used in the Mexican government before, we will have resources for social programmes. There is no need to get to that. Even if there were, it would be impossible politically.

Martin:           One thing that really struck me about AMLO’s book was something I’ve never heard before, which is that, at the moment, Mexico has the forth-highest number of billionaires of any country in the world. That suggests that there’s a lot of misdirected resources within the Mexican economy.

Sergio:          Forget about the billionaires! The fact that this is one of the most open economies of the world, but 95 percent of our exports come from around the two percent of our enterprises tells you a lot. Small enterprises are not connected to the global markets. It’s just big enterprises. I think that’s a problem. If you go to a European country or to the U.S., micro enterprises have ten percent of exports. I know that those are the ones that actually create employment in Mexico: not the big ones, but the medium and small ones. In the economy where most Mexicans work, there are no connections to go to the global markets. That’s a problem.

Martin:          How do you build those connections?

Sergio:          We’re working on that. We need to develop them. We need to help them. We need information to help them to learn to use all those free trade agreement that we have. There is no country in the world with more free trade agreements then us. Most of them are useless. No one is using them. So I think there is space to improve things, but you need a different kind of programme. Let it grow. Let’s see how we build it.

Martin:         Sergio, thanks so much for your time, and all best wishes for the work ahead. We’ll all be wishing the new administration all the best for the future, and watching to see what you’re all able to build here.

Further Reading

Andrés Manuel López-Obrador, A New Hope for Mexico: Saying No to Corruption, Violence, and Trump’s Wall, (Pluto Press, 2018)

This is one of two Renewal interviews with members of Democracia Deliberada who have now moved into political roles in the new leftist administrations at the national and city-government levels in Mexico. For an interview with Andrés Lajous, Secretary for Mobility under new mayor Claudia Sheinbaum, in the CDMX city government, see here.

With many thanks to James Hickson, Claudio López-Guerra, and Paul Segal, and to Kieran O’Connor of Pluto Press for sending me an advance copy of AMLO’s book in English.