Mr. Peña Nieto’s Wonderous Energy Reform

Alfonso Cuarón, director and co-producer of “Gravity,” a space disaster film I haven’t seen, won Best Director at the 86th Academy Awards. He was also chosen as “Most Creative” on Forbes’s Mexico List in 2013. With these credentials that separate him from being a ninguneo, a nobody, the good citizen asked a Mexican president traditionally endowed with near imperial powers—in this case Mr. Peña Nieto—to answer ten questions on the Mexican energy reform that has probably been decided upon already, with Cheney-like disinterest in the opinion of citizens—which is to say, of those who are not in the Club or the upper 1%. One could also mention that Mr. Nieto is a member of the PRI, the political party that ruled Mexico for seventy-one years with near dictatorial powers.

Here are Cuarón’s ten questions—with my subtexts.

One: When will the price of natural gas, gasoline, diesel and electricity begin to fall? What other benefits can we expect from the reform? When can we expect them to occur? Subtext in my words, not Cuarón’s. The prices of things generally climb when they are privatized.

Two: What will the effects be for the environment in the face of massive oil extraction? What measures will be put in place to protect the environment and who will take responsibility in case of spill and other disaster? Subtext: No measures will be put into place. It is part of the local culture that no one takes responsibility for disasters.

Three: Hydrocarbons are non-renewable resources. Their impact on the environment, meaning on the whole globe, is massive. What plans are there for alternate energy? Subtext: There are no plans.

Four: Huge amounts of profits will be generated by this reform—in the billions. In a country where the rule of law is so weak, who will regulate these funds and protect them from corruption? Subtext: No one will regulate these funds. They will not be protected from corruption. Additionally, there will be none of the transparency that is necessary for any kind of accountability.

Five: Transnational companies in the world often wield as much power as many governments. What measures will be taken to protect our democracy from financial pressures by powerful international interests? Subtext: There will be some protections—just enough to protect the interests of those in the Club.

Six: What regulatory measures does the government have at its disposal to protect the country from the predatory pressures that private companies can exert on the energy sector? Subtext: The Club has a maze of maneuvers that it can employ to protect its own financial interests.

Seven: How can you assure that Pemex will show an increase in production if the government does not confront corruption in that is within Pemex and its union? Subtext: There will be no assurances. The union corruption will continue. The higher-level corruption—the taking more of the people’s profits—will flourish.

Eight: If Pemex, in the last seventy years, contributed to more than half of the country’s federal budget, including education and free health care, and if now the earnings of Pemex no longer flow directly to the country’s coffers, what will replace that half of the federal budget? Subtext: Any diminution would probably be called in IMF-ese a “structural adjustment,” whereby the people will have less and the Club more.

Nine: How will you assure us that the profits from the reform will not be channeled into bureaucratic expansion rather than to the original owners of the resources: the people of Mexico? Subtext: There will be plenty of assurances, but they will be mostly smoke. Bureaucratic expansion is a euphemism for the Club. Profits from the reform will be channeled to the Club.

A friend of mine wrote the following in reaction to what I am writing here. Since I don’t have his permission, I will not mention his name. But it gives another point of view: “Incidentally, foreign investment and foreign management rules saved the mining industry here making work safe for the miners (before that life expectancy was about 10 years or less in the mines!), improved efficiency (the 80% silver going to the “people” today is much more than the 100% before; and 100% gold still going to the Mexican Treasury), and rooted out the most egregious excesses of corruption (of course, it is still Mexico, in a way). No, I would LOVE to see a shake-up in PEMEX and the whole rotten oil structure. I SUPPORT REFORM, because it is needed and it is helpful to Mexico and its people!

Ten: Two disastrous experiences remain in the minds of Mexicans. 1) The crash of 1982 that followed the waste, ineptitude, corruption that characterized the management of oil in the Seventies; and 2) the arbitrary, opaque and privatizing reforms under President Salinas de Gortari, that were good for the private hands but of dubious value for consumers. What guarantees are there that the social misery created then will not be repeated now? You and your party  carry the responsibility for these reforms. Do you really believe that Mexico can carry out these reforms efficiently, for the social good and with transparency? Subtext: There will be guarantees of benefits, but they will mean nothing. None of the parties will assume responsibility for what turns out to not be good for the country. The last question is aimed right at the heart of the matter. Mr. Peña Nieto and others in the Club say things they do not believe, or worse, that they do believe (see below); any efficiency will appear mainly in the acquisition of private profit; acting for the social good will remain a distant possibility, given the Club’s lack of a sense of social responsibility; there is little transparency at any level of Mexican government—thus, offering little possibility of citizen accountability. Without a free press there would be no hope at all.

Los Pinos, the Mexican White House, has responded with some vague reassurances that there will be commissions to study this and that. It is probably a good thing that the government has bothered to respond. But words are not actions.

Other voices have asked how an “upstart” like Cuarón would have the gall to presume to talk directly to the President of Mexico, Mr. Nieto.

Jesús Silva-Herzog Márquez, writing for Reforma, quotes journalist and political analyst Ricardo Raphael as saying that the elite are the central problem in Mexico. Silva-Herzog writes, “(that) one of the problems of our democracy is precisely the depth of the authoritarian convictions of those small and satisfied circles that thumb their nose at the country while happily looking at themselves in magazines. Convinced they are more knowledgeable than others, they think they are the only ones that can argue and, especially, decide. The autocratic persuasion of the elite shows in this notion that public discussion belongs exclusively to experts. Only we have the elements to discuss the energy reform, they tell us. Others have to shut up and vote when the day comes; and that that, and that alone, is democracy. We will give you clear options so you are capable of making a sensible decision (they say).

Therein lies the immense service provided by Alfonso Cuarón’s questions. To show that the technician’s arrogance cannot suppress the people.”

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