MXPE Weekly Essentials
Unpicking US fake news about Mexico, $1 billion from Netflix, and other highlights in Mexican politics, policy, and markets from the past week.
This week at CPAC, a yearly event for global conservatives to rally together, Mexican actor-turned-political activist aped Elon Musk in raising his arm in a Nazi salute. The actor, Eduardo Verástegui, has taken to seeking attention as he tries to found a political party in his own country, the ¡Viva México! party.
Whether he understands his role in it or not, Verástegui is now part of an ongoing attempt to “flood the space.” This is a tactic crafted by Steve Bannon—a former Trump aide who performed a similar salute at CPAC—in which the media and the opposition are baited non-stop so as to immobilise them altogether.
Mexico has unsurprisingly been dragged into this flooding strategy, with a continuous spray of outlandish claims being made against the country by prominent characters like Elon Musk, Tucker Carlson, and the US president himself. Whereas there is often a US outlet ready to fact-check these claims when they touch upon an issue stateside, few have the tools or knowledge to address such fake news about Mexico.
So, this might be a good moment to address some of the biggest claims. It will serve to both dispel unfounded rumors meant for political gain in the US and to cut through the noise to understand the true state of Mexico in the age of Trump:
“President Claudia Sheinbaum is in cahoots with the cartels”
Fake news always works on distorting a kernel of truth. Corruption and crime does permeate the Mexican state, but not in its entirety, not across the entire country, and not at every level of government. Though a few top-level public officials have been found to have been closely associated with cartels, the real problem is that every other day, local authorities are found to have some connection with organised crime.
Local police forces are the worst trained, the worst paid, and the worst scrutinised, making them the perfect target for corruption. Just last week, over 100 police officers were sacked from a single municipality for corruption.
Sheinbaum’s security strategy has sought to tackle the crime by focusing on bolstering local security coupled with large-scale arrests of corrupt police chiefs and local officials of all parties. This has been the biggest shift from her predecessor's strategy, which worked on the unsound basis that if the president is honest, the rest of politics will be too.
US media generally has not helped dispel the rumours of Sheinbaum’s involvement with crime by repeating that governments under her party, Morena, have had a policy of “Hugs not bullets” with the cartels. It is an anachronous reference to an old campaign slogan that quickly went by the wayside as Mexico doubled down on the military approach to crime fighting so admired by Trump.
Morena governments haven’t helped themselves either. They’ve been all too happy to shield top military figures accused of criminal activity. This blind defense of the armed forces is what should most be worrying observers.
“Mexico refuses to cooperate with the US on national security issues”
The US declaration that drug cartels are now terrorist organisations triggered much nationalistic rhetoric across the Mexican government. Sheinbaum went as far as to look to get Congress to alter the Constitution to explicitly say that any form of intervention from abroad would not be tolerated, specifically naming “incursions by land, sea, and air.”
This, linked with the previous rumour, has riled up commentators in the US. Many claim that Mexico is refusing to help the US deal with crime, drug smuggling, and migration.
Sheinbaum is walking a delicate political tightrope. No Mexican government can be seen to accept US interventionism lying down. The president, however, does not want to be seen as unhelpful as the Damoclean sword of tariffs hovers over her head. As a result, though the US press tends to latch onto her more nationalistic pronouncements, most of her policies have bolstered cooperation.
When asked if increased US drone surveillance over Mexico was a problem, Sheinbaum replied that “there's nothing illegal about it and is part of a collaborative effort to share information.” US secretary of state Marco Rubio similarly demurred and discarded military intervention, underscoring that information sharing would continue to be the preferred approach—something the US government would not do if Mexico was deemed to be uncooperative or too deeply enmeshed with the cartels.
“Mexico approved US special forces to operate on Mexican soil”
In bizarre contradiction to the claim that Sheinbaum is actively in cahoots with the cartels and blocking US action against them, comes this claim, pushed particularly by Musk on Twitter.
Its origins are easy to identify; it came as pro-Trump media belatedly caught on to the news that the Mexican Congress had approved the entry of the 7th Special Forces into Mexican territory. Essential context was excluded, including that this 11-person contingent is part of a perennial binational cooperation strategy that has gone mostly unnoticed for years.
To quote MXPE Weekly Essentials from over two months ago in regard to this very news:
This in itself isn’t particularly unusual. … The 7th Special Forces have a long history dealing in anti-narcotics ops and Latin American counter-insurgency tactics. They also have a history of training Mexican troops, as they did earlier this year under an ongoing programme called “Strengthening the Capacities of the Special Forces of the Defense Ministry.”
Don’t flood if you can’t swim
Mexican political figures look to benefit from these and other trumped up claims at their own peril. The Mexican opposition has tried to make hay from accusations that Sheinbaum is linked to the cartels. This strategy didn’t help them get votes in the election they lost in a landslide, and siding with a Trump administration threatening military intervention has not gone down well with the average voter now.
Meanwhile, the debate around Verástegui’s salute in Mexico has been decidedly undivisive. The media has clearly labeled it as a Nazi gesture and moved on, despite Verástegui’s attempts to bring the issue up repeatedly. In this case at least, he was unable to lead the national conversation as he so clearly intended to.
Uncharted Mexico: Income distribution
Despite worries that Mexicans would cease to work as government cash handouts increased under Andrés Manuel López Obrador (2018-2024) and then Claudia Sheinbaum, the percentage of people’s income reliant on government transfers has stayed relatively stable—falling somewhat after people were allowed to get back to work following Covid-19.
Transfers here refer to government programmes, along with remittances and pensions—all of which went up during this period—, as well as transfers from one household to another—the only indicator to substantially decline during this period.
Source: Encuesta Nacional de Ingresos y Gastos de los Hogares 2022 (ENIGH)
This weeks highlights:
Blockbuster investment—Netflix has said it will be investing $1 billion dollars in Mexico over the next four years. This is the second billion-dollar announcement in the past month—the first was Nestlé—which has seen the nature of Foreign Direct Investment in the country start to change, from those heavily aimed at exporting manufactured goods to the US to more diverse industries and markets.
Just this week Sheinbaum announced her desire for streaming platforms like Netflix to contribute to a fund aimed at maintaining Mexico’s telecoms infrastructure in a good state. A sop to telecoms providers like Carlos Slim.Going public—Entrance exams to Mexican public highschools and universities are gradually being eliminated (apart from those in the very top tier, namely UNAM and IPN). The government says this will end the exclusion of millions of young people from higher education—students who have been a massive boon to Mexico’s many low-quality private universities.
An appeal to unreason—Congress has passed a law altering an appeals law, known as amparo, which protects citizens from government overreach. The change limits the effects of an appeal to the person who made it and will no longer extend to any other citizen thereafter aggrieved by the law, as has been the case until now. The government says amparos have been abused by powerful economic interests keen to block government projects. Opponents worry the law will undermine justice in Mexico: “What is the point of determining that a law is unconstitutional and yet limiting the verdict to the single person who filed the lawsuit?”
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Mexico: The Podcast
The history of Mexican poverty and inequality in 5 stats. In this episode, we try to answer, is Mexico poor?
Available here, Spotify and Apple Podcasts.
Local zoom in: Border seizures down
Fentanyl seizures by the US Border Patrol were down in January and predicted to fall again in February. This is no doubt a result of Mexico’s new policy to crack down on the drug, with the historic seizure of a tonne of pills in December now having measurable downstream effects.
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