Salinas to Open Mexico for Markets, Rival Politics

A new generation of leaders is emerging on the world stage, representing what might be called the post-ideological left. Michael S. Dukakis, the Democratic Party’s prospective presidential nominee, is one. Soviet leader Mikhail S. Gorbachev is another.

In their values, they are loyal to their party traditions. But they often reject rigid ideological formulations of the past. Their critics call them technocrats. What they are is problem-solvers. If political traditions get in the way of solving problems, then it may be time to re-examine the traditions.

Another name can be added to this list--Carlos Salinas de Gortari of Mexico. The 40-year-old Salinas is the ruling party candidate in next month’s Mexican presidential election. He won’t have a problem getting elected. His party has not lost a presidential election in almost 60 years. His problem is more difficult--restoring legitimacy to the system he represents.

There is probably no party on earth as encrusted with myths and rigidities as the ruling party of Mexico. Even its name reflects this--the Institutional Revolutionary Party, or PRI. Look at how Salinas was nominated--the dedazo , or “tap on the shoulder,” by the outgoing president, Miguel de la Madrid.

God knows, Mexico has problems that need solving. During the oil boom of the 1970s and early 1980s, Mexico went on a binge of spending and borrowing that nearly ruined the economy. Horrified by the excesses, De la Madrid undertook an austerity program. The architect of these reforms was Salinas, a Harvard-educated Ph.D. who served as budget minister.

Salinas’ policies threatened established interests protected under the old system of “statist populism.” His policies came under even greater pressure after oil prices collapsed in the mid-1980s. Some 25% of government revenues had come from oil. Unlike previous presidents, however, De la Madrid stuck with his austerity program. Designating Salinas as his successor demonstrates his commitment.

There are signs of progress. Inflation has been cut and the debt situation seems to be under control. This has come at a price, however. Real wages for industrial workers have declined by more than 50% since 1982. Unemployment is severe.

According to a report on Mexico prepared several years ago by the Central Intelligence Agency, “Many upper-middle-class and business leaders feel alienated from the PRI and are beginning to discuss political alternatives. . . . This trend, now in its formative stages, could accelerate.”

Salinas’s program aims at reversing the trend. His difficulty is that he must do it from within. The PRI is the only available instrument for reform. But it is also the greatest obstacle.

In an interview with The Times, Salinas summarized his solution to Mexico’s economic problems: “Grow, grow. Grow with a strategy that emphasizes more jobs per peso invested. And that is very much dependent on increasing exports.”

The Mexican economy has long been statist, with massive government spending and public subsidies to satisfy important constituencies. Major sectors, such as the oil industry and the banks, have been nationalized. Indeed, De la Madrid recently described his job as “rector” of the national economy.

When Salinas was asked what he thought that meant, his answer was anything but statist. “The state must promote growth,” he said. “That does not substitute for individual effort. We have a mixed economy, and I’m trying to have it more mixed. Any modern state has a responsibility to promote growth. Governments of other countries promote their businesses. It’s the same for us.” That sounds a lot like Dukakis, and there’s a reason. Both men attended the Kennedy School of Government at Harvard.

At times, Salinas even sounds a little like Britain’s Margaret Thatcher. “You cannot have a proper exchange rate for the most inefficient businessmen,” he said. “Some will have to die. The efficient ones will live.”

How can the United States help Mexico’s economic modernization? “Keep your markets open, because we are opening ours,” Salinas said. “If you want the debt served, it is illogical for you to close your markets to Mexican exports that provide the foreign exchange to service the debt.” He added a warning, however. “We must grow. For me there is no question. We will service the debt if it does not hinder the possibilities (of growth) in Mexico.”

In the opinion of many, Mexico’s continued economic modernization is dependent on political change. You can’t have an open economy and a closed political system. Salinas is clearly sympathetic to this. “We need to go much further with political modernization,” he said.

He is talking about political competition, an idea alien to PRI. “In the past we were almost a one-party system,” Salinas said. “Now we have a plural system in which we are a majority. My intention is to keep our party a majority, but that will have to come out of a stronger organization and more participation, because the competition is also strong.”

Competition is exactly what he is getting. The latest poll shows Salinas winning 56% of the vote, the smallest PRI majority ever. The opposition has threatened a massive campaign of civil disobedience if the PRI resorts to election fraud on July 6. Salinas has repeatedly said he wants “transparent elections,” which he explains as “clear results.”

Is PRI ready to accept what was unthinkable: losing elections at state and local levels? One PRI spokesman said--off the record--that a few losses would be to the good. “It’s the only way to frighten traditional party leaders,” he said. “The party can use the opposition to show there’s a challenge. That may be good for Salinas. He can ask the party to reform.”

Salinas admits that his role model is Mexico’s great reformer--and chief myth-maker--Lazaro Cardenas, president during the 1930s. He nationalized oil companies and created PRI and the institutions of the modern Mexican state.

“Unfortunately,” Salinas said, “those reforms are fading because of generational and economic changes in Mexico. So we have to create new reforms.” What he admired most about Cardenas, he said, was that he created “a system that lasted.” In other words, Salinas aims to be an institution-builder.

This is slightly embarrassing because one of Salinas’s principal opponents in next month’s election is Cuauhtemoc Cardenas, son of the great reformer. Cardenas, currently second in the polls with 23%, is a former PRI governor. He broke with the party and now leads a left-wing coalition. Cardenas is running on his father’s platform, namely PRI’s traditional state populism. The old reforms have become the new orthodoxy.

What can the United States do to help the cause of political modernization in Mexico? “Nothing,” Salinas said. “Our political system belongs to us.”

Indeed, many Mexicans were angered when the California Democratic Party, under pressure from Mexican-American activists, passed a resolution asking the United States to put pressure on Mexico to ensure fair elections. When a U.S. observer remarked the United States would never tolerate serious instability along its borders, Mexicans were outraged. The United States sent a military expedition to Mexico during the 1910-1911 Revolution and Mexicans have never forgotten--or forgiven. “Our political system responds to our own characteristics,” Salinas declared. “For the last 60 years we have had a peaceful transition of power in Mexico. That is something no other Latin American country, and few countries in the world, have been able to achieve.”

Like all problem-solving politicians, Salinas has a problem of his own. He wants to take on the Establishment and reform the Mexican system. But the Establishment is going to fight back. So Salinas needs a political base to protect him. Technocrats may know a lot about exchange rates and water projects, but in the end they have to rely on their political skills to keep them out of trouble.

Does Salinas have the political skills? He thinks so. “I have had to deal with my colleagues in eminently political relationships. I have dealt with all the governors of the states and presented my budgets five times to the Chamber of Deputies. I have had to get together with political parties, with union leaders to negotiate wage increases, with peasants to negotiate basic prices. So you see, as a technocrat you have to do a lot of politicking.”

What Salinas has not done is build a base of popular support, however. He has never held elective office. But then, neither did his three predecessors. His selection as presidential candidate was a surprise precisely because he was considered too unprepossessing for the job.

That is why Salinas has been campaigning so hard. He doesn’t have to worry about winning. He has to worry about developing a base of popular support that will carry him through a difficult and controversial six-year term.