SEEING MEXICO

BY MICHAEL MASSING

If you've been following the news from Mexico, you no doubt know that Vicente Fox wears cowboy boots. "The new president, clad in his signature jeans, blue shirt, and cowboy boots," The Dallas Morning News reported of his inauguration last December, "met with poor street children, held a mass rally, and paraded through the streets of Mexico City in a convertible." Fox, the Los Angeles Times observed, "revels in his country roots, using colorful language, wearing cowboy boots, and frequently returning to his ranch to ride horses." In February, when President Bush visited Fox at his ranch, the fact that both men sported cowboy boots figured prominently in the coverage. The "Boot Summit," The Wall Street Journal called it. According to The Boston Globe, "They both like straight talk. Custom-made boots. Ranches. In other circumstances, George W. Bush and Vicente Fox might have been fraternity brothers."

In March, The New York Times, in a story headlined president of mexico does not stand on ceremony, described how Fox, while riding to a rally to honor the national oil company, spotted a girl in a wheelchair on the side of the road. Ordering his driver to stop, he got out to meet her. "Her parents froze in disbelief at the sight of the 6-foot-5-inch president towering above them in a blinding white guayabera and his signature cowboy boots," the Times reported. When they told Fox that they were too poor to afford therapy for the girl, the president promised to help. "That detour, his supporters say," the Times observed, "shows how Mr. Fox is trying to transform this country, starting with the regal culture of the presidency." When past presidents mixed with the public, "they were aloof, their handshakes were polite; their language, flowery and highfalutin. Mr. Fox pulls people toward him, kissing women on the cheek, and his speech is as earthy as a barnyard."

As these articles show, Vicente Fox has gotten an extended honeymoon from the U.S. press. And that's understandable. His election, putting an end to seventy-one years of stultifying rule by the Partido Revolucionario Institucional (PRI), marks a true watershed in Mexican history, and U.S. reporters, like the Mexican people, have gotten caught up in the euphoria. In recent weeks, as the first signs of disillusion have set in, reporters have sobered up, too, filing stories about the growing pains of the Fox administration. Yet even these accounts have dwelled on the president's personal fortunes. Consumed with Fox the man, the press has paid little attention to some of the really important stories about his early days in office.

For instance, you probably haven't read about the great ruckus set off by Fox's tax plan. During the presidential campaign, he had promised that if elected, he would make fighting poverty one of his top priorities. A former Coca-Cola executive, Fox was known for his conservative views, but during the campaign he gained much support by expressing sympathy for the 40 percent of the population that lives in extreme poverty. To help them, Fox vowed that, as president, he would spend much more on education, health, roads, and communications. To do that, though, he would need more revenue. Mexico takes in only 11 percent of its GDP in taxes every year -- far below the 18 percent average in Latin America as a whole and the 25 percent or more in most industrial nations.

So, among his early acts as president, Fox sent to the Mexican Congress a package of fiscal reforms. Its core element: a 15 percent value-added tax on consumer goods, including food and medicine. Such a tax would inevitably hit the poor the hardest, and its proposal elicited howls of protest from the opposition as well as members of Fox's own party. Its passage remains in doubt.

The dispute offers some early clues into the nature of the Fox presidency and its willingness -- or ability -- to challenge the status quo in Mexico. Yet, of the accounts I've read, only one -- in the San Antonio Express-News -- did it justice. This is discouraging -- but not surprising. Over the past twelve years spanning two presidencies, the U.S. press has served up gross caricatures of Mexico, careening wildly from one extreme to the other. In the process, it has missed what is, I believe, the central story about our southern neighbor.

Carlos Salinas de Gortari, Mexico's president from 1988 to 1994, stands only five-feet-four, but to most U.S. correspondents he was a towering figure. Salinas began his term under a cloud, winning just 50.7 percent of the vote amid widespread accusations of fraud, but once in office he moved quickly to dispel it. A forty-year-old economist with a Ph.D. from Harvard, Salinas was a committed free-marketeer, and, surrounding himself with like-minded U.S.-educated technocrats, he set out to remake the Mexican economy. He tightened money supplies, welcomed foreign investment, lifted regulations, sold off state-owned enterprises, and promoted trade with the United States.

Initially, the economy responded well: the deficit shrank, inflation fell, and the stock market soared. Washington and Wall Street applauded, and so did U.S. reporters. Carlos Salinas "is emerging as the most courageous and innovative Mexican president in modern times, propelling his country into the new world economy," Michael Barone and David Gergen wrote in U.S. News & World Report in April 1990. That same month, a Wall Street Journal article stated that, at a time when most stock markets were sagging, Mexico's was a "shining star." Many investors, the Journal added, "believe that the best is yet to come in the market-oriented economic program of Mexican President Carlos Salinas de Gortari."

By the spring of 1991, most of the remaining doubts about Salinas had disappeared. salinas is riding a winning streak in mexico, The New York Times declared. "Two and a half years after winning office in a bitterly disputed election," it reported, "Mr. Salinas still carries the checkered legacy of his political party," but "his economic policies and nonstop countryside campaigning" have "redeemed his image with a string of conspicuous political victories that have left his opponents in disarray."

Even more bullish was The Washington Post. In a front-page article, the paper reported that "Salinas's revolution is rooted in a new realism about Mexico and its problems. In a land where politicians have often been known for flowery rhetoric and unkept promises -- and political corruption -- Salinas, at least thus far, has insisted on honesty and relatively clean government." Hailing Mexico's economy for being "one of the world's most open," the Post noted that the results are "visible on supermarket shelves, where pricey Italian pasta, Spanish wine, and U.S. breakfast cereals have become available alongside lower-quality Mexican products. For the first time, Mexican-licensed Corvettes and Cadillacs have begun cruising the capital's streets with home-built Volkswagens and Chryslers."

In offering such praise, the Post did not stop to consider how many Mexicans could afford that pricey pasta or those Corvettes and Cadillacs. While Mexico's middle class was indeed expanding under Salinas, many Mexicans continued to struggle. In shrinking the role of the government, Salinas had shut down many state-owned enterprises, costing tens of thousands of jobs. Many of the companies that were privatized carried out massive layoffs, throwing more out of work. In another troubling sign, the buyers of those companies were in many cases well-heeled investors with close ties to the Salinas government, raising concerns about the growing concentration of economic power.

That was especially true of Mexico's great bank sell-off. Back in 1982, the government had nationalized eighteen commercial banks, and the Salinas administration -- eager to divest them -- put them up for sale. Most were purchased by small groups of wealthy individuals. Banamex, Mexico's largest bank, was snapped up by a consortium led by Roberto Hernandez, the president of Mexico's leading brokerage. Some Mexican journalists wondered about the consequences of placing so much financial might in so few hands. But American papers showed little concern. Hernandez, The New York Times reported, "made it clear in an interview that his acquisition marked the latest episode in a running display of optimism about the Mexican economy. 'All signs point toward stability and confidence,' he said. 'This country is changing so quickly that sometimes we don't recognize it. But it's extraordinary. This is a new country.'"

Time magazine agreed. In January 1993, it declared Salinas its international Newsmaker of the Year for Latin America. Salinas, the magazine observed, "has almost single-handedly energized a nation that used to be jealous and resentful of the dynamism exhibited north of the border . . . . It may take two generations for Salinas's reforms to produce a full harvest of plenty, but in the meantime he has afforded Mexicans the ballast of hope and the beacon of pride."

The admiration for Salinas did have its limits. In political affairs, he was in many ways a typical PRI boss, and U.S. reporters could be sharp in describing his refusal to relax the party's grip on power. But his economic policies rarely came in for such scrutiny, and in the end these eclipsed everything else. The clincher was the North American Free Trade Agreement, which Salinas had vigorously pushed. "In the annals of economics, Carlos Salinas de Gortari holds a place of honor," Newsweek wrote on the eve of the vote in the U.S. Congress. The magazine saluted his "courage in tearing Mexican policy from its traditional path, in making the hard choices that governments tend to avoid."

NAFTA took effect on January 1, 1994. That same day, more than 2,000 Mayan Indian and other rebels carrying machetes and AK-47s seized several cities in the southern state of Chiapas, demanding redress for centuries of neglect. Suddenly, Mexico had a real revolution on its hands. The uprising stunned not only the Salinas government but also many U.S. journalists, and they finally began asking questions about his economic program. "Did Mr. Salinas's almost single-minded focus on economic changes like privatizing state-owned businesses, holding down salaries to reduce inflation from more than 150 percent to single digits, and signing the North American Free Trade Agreement lead him to ignore -- or worse, cause -- social unrest of the type that exploded in Chiapas State as the year began?" The New York Times asked. "Were the administration's technocrats, trained in United States universities and expert in macroeconomics, too aloof from ordinary people to hear their complaints?"

A few months later, Forbes magazine published its annual list of the world's billionaires. On it were twenty-four Mexicans -- up from just two in 1991. Joel Millman, who helped compile the list, observed in The Washington Post's Outlook section that twelve of the twenty-two new billionaires had obtained their fortunes from one deal -- the privatization of Banamex.

Yet neither Chiapas nor the evidence of Mexico's growing inequality could stop the cheering for Salinas. "After the opening of Mexico's economy in the mid-1980s," The Dallas Morning News declared in the waning days of his term, "the nation's stock market burst out of a cocoon, emerging as one of the developing world's highfliers and attracting U.S. investors. It's not done yet."

On November 30 -- the eve of Salinas's departure from office -- the Los Angeles Times ran a piece touting his campaign to become the head of the World Trade Organization. Salinas, said the Times, "brings to his bid a striking record of having converted an inward-looking, protectionist country into a leading free-trader, a member of the most important international economic organizations, and a founding partner in the world's largest trading bloc, the North American Free Trade Agreement."

The next day, Ernesto Zedillo took over as president. He quickly discovered that the country's foreign reserves had dropped dangerously low; three weeks later, his government was forced to devalue the peso. Shaken, U.S. investors began withdrawing their funds from Mexico. Within two weeks, the Mexican currency had lost 50 percent of its value. The stock market plunged, and the newly privatized banking system collapsed. With credit virtually unavailable, thousands of small and medium-sized businesses went under. Overall, an estimated million people lost their jobs, and the purchasing power of the average wage fell by 20 percent. Only a rescue package organized by the U.S. prevented a total collapse.

Two months later, Carlos Salinas's brother Raul was arrested on charges of having been involved in the murder of a high PRI official the previous year. While he was in prison, a team of investigators found that he had deposited more than $100 million in secret Swiss bank accounts. Raul offered no explanation for the money; speculation centered on bribes from drug traffickers or pay-offs from businessmen seeking influence with the Salinas government. Carlos himself claimed to know nothing about his brother's dealings, and, to protest Raul's innocence, embarked on a hunger strike. It was short-lived, however, and soon after, Salinas fled the country, eventually taking refuge in Ireland.

These events left Mexicans feeling traumatized, and U.S. journalists feeling stung. All those glowing stories about the Salinas "revolution" now seemed a colossal embarrassment. With the installation of a new president, a new batch of correspondents arrived to cover him, and they were determined to avoid their predecessors' mistakes. John Ward Anderson, who came with his wife, Molly Moore, to cover Zedillo for The Washington Post, told me in an interview last year what the mood was like when he arrived. "Everybody had been in love with Mexico," he said. "That was the news -- Mexico was changing, there was democracy and brave new leadership. It was hard getting negative stories into the paper. You had Harvard- and Yale-educated leaders, and the World Bank and the IMF were lauding them. Wall Street was going bonkers over them. Everyone ended up with egg on their face." Anderson recalled his first meeting with Mexico's new president: "I told Zedillo that Carlos Salinas was his biggest enemy, because the entire press corps felt like it had been snookered by him. I told Zedillo, 'I'm not going to give you the benefit of the doubt on anything.'"

From the start, then, U.S. reporters were determined to be tough on Zedillo. And they quickly found a good hook: the rise in narcotrafficking. Mexico had long produced heroin and marijuana for the U.S. market, but in the late 1980s Colombian traffickers, seeking new smuggling routes for their cocaine, began shipping it through Mexico. Mexico's drug gangs demanded a piece of the action, and, flush with cash, they grew increasingly violent and powerful. To ensure passage of their goods, they paid off politicians and the police, and, to ward off rivals, they carried out executions and drive-by shootings. The mayhem was particularly intense along the U.S.-Mexican border, with bloodshed spilling over onto the American side.

U.S. journalists pounced on the story. Just as the free-market revolution had been the main story line under Salinas, it was now drugs, violence, and corruption. Leading the way was The New York Times, which formed a special investigative unit to look into the story; other newspapers worked hard to keep pace.

In pursuing the story, journalists found a ready source of information in the Drug Enforcement Administration. The DEA worked in many countries around the world, but none riled it as much as Mexico. Its animosity went back to February 1985, when agent Enrique Camarena was abducted, tortured, and murdered. His mutilated body was eventually discovered buried in a field near Guadalajara, and a major trafficker was apprehended and convicted of the crime. The DEA, however, remained convinced that high Mexican officials had been involved and that the Mexican government was covering up for them. By the mid-1990s, with corruption spreading, U.S. agents zealously collected evidence about it, and, when approached by journalists, they willingly shared it.

The result was a strange alliance between U.S. journalists and drug agents to expose the failures of the Zedillo government in taking on the traffickers. The sheer volume of the coverage was breathtaking. On my desk, I have a stack of clips two inches high, all of them about drug trafficking in Mexico. Some of the stories are quite impressive, documenting the corrosive effect drug trafficking has had on the country; The New York Times won a 1998 Pulitzer Prize for its coverage.

Mostly, though, the coverage was alarmist and one-dimensional. The headlines in the box to the left convey the flavor.

The coverage reached a peak in the fall of 1999, when journalists from around the United States (and the world) descended on the border city of Juárez to report on the search for victims of drug traffickers buried on two nearby ranches. For days the story was front-page news, and most accounts estimated that investigators would find more than 100 bodies. In many cases, the event became an opportunity to lambaste the Mexican government for its inaction in the face of the killings.

On ABC's Nightline, for instance, Thomas Constantine, the former head of the DEA, decried the lack of cooperation he'd received from his Mexican counterparts. "We know the top twenty or thirty traffickers," he said. "We've indicted them in the United States, yet they're never to be found, never to be arrested." Ted Koppel wondered aloud what would happen "if the government of the United States went to the Mexican government and said, 'In that very narrow border area, would you permit us to send U.S. troops in there to clean it out?'" The idea of invading Mexico was too much even for Constantine.

Six weeks later, investigators announced their final count: nine bodies. In reporting the expectation that more than 100 bodies would be found, the press had relied on the FBI. The FBI, in turn, had gotten that figure from an informant from inside the drug trade. So, in relying so heavily on official sources, American reporters had gotten burned.

It was hardly an isolated case. Much of the information that American journalists got from U.S. law enforcement came from informants with ties to the traffickers. In many instances, those informants faced prison terms, and, they knew, the more information they provided, the less time they would have to serve. They had an incentive to embroider their reports, and the distortions that resulted frequently made their way into news accounts.

What's more, journalists, by relying so heavily on the DEA, came to see the central issue of Mexico's drug problem largely through the agency's eyes: Was the Mexican government doing enough to confront the drug trade? Rarely did reporters stop to ask whether more aggressive action could have any real impact. The record showed that whenever a major trafficker was taken out, another would quickly take his place, and the flow of drugs into the United States would continue unimpeded. Few stories took note of this.

Nor did they mention the role that the demand for drugs in the United States played in sustaining Mexico's drug trade. In December 1995, for instance, The New York Times carried the headline mexican drug dealer pushes speed, helping set off an epidemic in u.s. This made it sound as if the nefarious Mexicans were somehow forcing Americans to take drugs. Another reading, of course, would be that Americans, hungry for speed, were providing the Mexicans with a new market. u.s. demand for speed soars, stimulating mexican production, an alternative headline might read.

In the end, the movie Traffic did a far better job of conveying the nuances of Mexico's drug problem than did U.S. journalists. Director Steven Soderbergh managed to capture both the corrupting nature of the Mexican drug trade and the slim hope that anything can be done about it. As the movie showed, the traffickers are too easily replaced, the border too full of holes, the hunger for drugs in the United States too great. After all those hundreds of reports about the drug problem in Mexico, it took Hollywood to get it right.

Throughout Zedillo's term, Mexico struggled to recover from the fall-out from the Salinas years. The 1994-1995 recession proved to be one of the deepest in Mexican history. Unemployment remained sky-high and the informal sector swelled. Gradually, the economy began to expand again, and, under NAFTA, exports soared, but poverty continued to surge and inequality to grow. In 1998, the Zedillo government approved a $100 billion bailout for Mexico's collapsed banks, using taxpayer funds to compensate their wealthy owners. This helped feed the country's income disparities, and by the end of Zedillo's term Mexico had one of the most unequal distributions of income in the world. Unfortunately, the U.S. press -- absorbed in the drug issue -- paid little attention.

To be fair, U.S. news organizations ran many probing stories during the Zedillo years. They chronicled the growing power of the Mexican military, the harassment of women workers in assembly plants, the plight of Mexico's peasant farmers. And, as the 2000 presidential campaign began, the press did a fine job in describing the struggle to ensure that the election would be free and fair.

With the Fox administration still young, it's too soon to say what the press's story line will be this time around. But the coverage to date suggests that, as in the past, reporters will fail to capture the power of the Mexican oligarchy, and its ability to frustrate true reform. On May 21, for instance, The Wall Street Journal ran a front-page story praising the efforts of Guillermo Ortiz, the chief of Mexico's Central Bank, to strengthen the peso by pursuing strict anti-inflation policies based on high interest rates. "As the fledgling government of President Vicente Fox is still fumbling for a firm grip on the nation's rudder, the foreign-exchange market has come to regard Mr. Ortiz as a pillar of credibility," correspondent Peter Fritsch reported. The article carried endorsements of Ortiz's efforts from Citigroup vice chairman Robert Rubin, former U.S. Treasury Secretary Lawrence Summers, and analysts from Morgan Stanley and Goldman Sachs. Fox's proposed tax reform was mentioned with great enthusiasm. If it passed, the Journal noted, Standard & Poor's would likely boost Mexico's credit rating to "investment grade," and that "would probably inspire more investors to put their money into Mexican assets, giving the country's currency a boost."

The article made no mention of Mexico's high unemployment rate, its massive poverty, its income disparities -- issues that underlie so many of Mexico's other problems, from corruption to migration to drug trafficking. And, only toward the end, in passing, did it note that Guillermo Ortiz had played a role in Carlos Salinas's bank privatization program, the one that had created so many billionaires and eventually required a $100 billion bailout. With its cheerleading tone, obliviousness to the poor, and quotes from Wall Street, the piece seemed to resurrect all the worst features of the coverage of the Salinas era.

It could be a long six years.

 

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Michael Massing is a contributing editor to cjr. He is the author of The Fix, about America's drug war, published in paperback last year.