Can Mexico Clean Up War of the Sidewalks?

It’s holiday season in this capital, time for the winter war of the sidewalks.

But this year, the arrival of democracy in Mexico City has upset the cozy and openly corrupt power balance that imposed a semblance of order in the annual battles among street vendors--and ensured the ruling political party a loyal army of supporters.

The skirmishing usually proceeds like this: Scouts with whistles and cellular phones spot an unpoliced street and dispatch their toughest traders to stake out key sidewalk positions with blankets full of baubles. Waves of other vendors follow, conquering whole streets.

Then helmeted riot police counterattack and disperse the mobile traders, who scatter and prepare for another commercial invasion a few blocks away.

For decades, the long holiday season in Mexico, stretching from Oct. 30, just before the Day of the Dead, to the important Day of the Three Kings on Jan. 6, has provoked conflicts among street vendors, shopkeepers, police and city authorities. In the end, relative peace has been achieved through lucrative deals cut between political bosses and vendor leaders, who rule their clans like Mafia dons.

Now, the ascension of the city’s first elected mayor has set off renewed scrambles for commercial turf and complex new alliances. Bravely or naively, Cuauhtemoc Cardenas has promised to find a longer-term solution to a problem that embraces such fundamental Mexico City issues as joblessness, corruption and organized crime.

The new mayor underlined the importance of the street-vendor issue in his inauguration address, saying: “The streets cannot continue being economic and political booty. . . . There will be order, peace and collaboration in the streets of our capital. We will halt extortion by public officials.”

The unruly capital, by many measures the world’s largest metropolis, is a magnet for street traders, who are conservatively estimated to number 130,000 to 250,000--climbing as high as 500,000 at the holiday peak, according to the city’s Chamber of Commerce. The vendors multiply when Christmas brings throngs of people clutching their annual bonus pay--usually an extra month’s wages--into the festooned plazas and narrow downtown streets to buy decorations and gifts.

That ignites the war for the sidewalks, especially in the coveted central historic district, which police try to keep hawker-free most of the year. Tens of thousands of street vendors vie relentlessly for choice sites to sell T-shirts, cassettes, plastic toys, kitchen utensils and hair clips, while police try to fend them off--or take a bribe to let them stay awhile. Just as often, skirmishes break out between rival vendor factions and between vendors and angry shopkeepers whose doorways are blocked.

Centuries-Old Tradition

Trading is rooted deep in Mexican culture. The heart of the Aztec empire’s capital of Tenochtitlan, which fell to Spanish conquistador Hernan Cortes in 1521, occupied the same spot in the Mexico City historic district where today’s traders vie for sidewalk space.

There are levels within levels of bewildering gradations in the street-trade pecking order, which embraces everyone from fire eaters and window washers at traffic lights to itinerant trinket sellers to cart-based traders who take part in tianguis, the Aztec word for movable one-day markets held in different neighborhoods each week.

Higher up are the “semi-fixed traders,” vendors who open their collapsible stands on the same spot each day, protected by associations and powerful leaders. And at the top are the stall holders in the indoor city markets, who have either purchased their stands or pay monthly rent.

The economic importance of all this informal trading is indisputable. A government study released this month calculated that 3.4 million people, or nearly 10% of the economically active population, earn their living from some form of informal business, ranging from street vending to operating taco stands to haircutting.

The informal sector has grown 26% since 1994, before the peso crisis sent Mexico into a vicious recession that drove many firms into bankruptcy. And the street-vendor component grew even faster than the overall informal sector over the past two years, jumping 40% to an estimated 775,000 hawkers nationally.

As they grew in numbers, the vendors became a powerful tool for the Institutional Revolutionary Party, or PRI, which has ruled Mexico since 1929 and always appointed the capital’s regent (the city leader before the mayoralty was created this year). Cardenas, a former PRI member who launched the Democratic Revolution Party, or PRD, in 1988, won the first mayoral election in July and took office Dec. 5.

The vendor leaders could instantly turn out crowds of thousands of vendors for PRI rallies and marches, a valuable bargaining chip in return for favorable treatment.

“The street sellers were always a pressure group that was used as a PRI electoral clientele--submissive, unconditional and easily mobilized to appear almost at the will of the regent and the party in power,” said Saul Escobar, a member of the Cardenas transition team.

“But over the years, this problem became uncontrollable, and the vendors became a sort of Frankenstein for the government, which up to today they haven’t been able to resolve,” Escobar said. “And the corruption that was generated began to gnaw away at the public administration itself.”

Ties to Organized Crime

A serious concern in the crime-ridden capital, Escobar said, is the apparent growing link between street vending and criminal organizations.

Recently, he said, the vendors “have begun to be a channel for the sale of stolen and pirate goods. Whole trailers have been hijacked, and the contents suddenly appear on the streets at cheap prices.”

In the past few years, a total of 10,000 temporary vending permits, including 3,000 for the city center, have been distributed between Dec. 13 and Jan. 6--virtually all to the pro-PRI vendor groups. After Cardenas’ victory, some hawker groups defected from the PRI and rebelled against the permit system.

The parties and vendor leaders agreed on a more democratic system for this holiday season, complete with applications and photo IDs. This year, the income from the permits will go to the city coffers rather than into the vendor leaders’ pockets. The permits cost between 2.50 and 7.50 pesos a day, or about 30 to 90 cents.

Still, thousands of unlicensed vendors, derisively called toreros (bullfighters), are competing with the permit holders for space as Christmas nears. Newspapers are filled with accounts of jostling and bribery and maneuvering among the vendors, legitimate business owners and road inspectors.

For generations, Mexico City authorities have variously sought to outlaw informal trading, to control it or to exploit it as a political tool. As long ago as 1931, a newspaper headline moaned: “Growing invasion of city sidewalks--Ambulant vendors don’t leave any room for pedestrians.”

In the 1950s, under pressure from the National Federation of Chambers of Commerce, then-Regent Ernesto Uruchurtu attempted a bold solution: Move all the vendors into fixed markets, then ban them from the streets with brute force. He built more than 160 markets, housing 50,000 vendors. In return, the PRI expected and got unconditional loyalty from the hawker organizations.

By the late 1960s, however, “The downtown streets that had been cleared with so much violence and coercion once again became choked with commercial activity, and the lucrative game of corrupt toleration returned,” wrote Gary Isaac Gordon in a University of Chicago doctoral dissertation.

Another attempt was made in 1993 and 1994 to negotiate a solution and get the latest deluge of street vendors into organized markets. The city built 28 commercial plazas for 10,000 vendors. But many markets failed, while the successful markets attracted a new generation of illegal traders who paid bribes openly to police and inspectors to allow them to work the streets outside.

Paying for Protection

Taking advantage of the heavy holiday sidewalk traffic, the outlaw street traders can still make a small profit despite charging lower prices and paying off area leaders for protection.

Miguel Angel Huerta, a handsome, partially blind vendor leader, has spent 18 years building up his organization of 1,200 traders based at Los Mesones city market. He said corrupt city officials have allowed more and more traders to swarm outside.

The illegal vendors on the streets pay 40 pesos a day ($5) to inspectors to be left alone, he said, and still can take home an additional 40 to 80 pesos.

“And if you can do that well,” he added, “obviously people prefer to sell on the streets rather than go hungry.” The minimum wage here is 24 pesos a day ($3).

One traditional flash point is La Merced market, a 40-year-old complex of huge vaulted halls a few blocks east of the main Zocalo square that is the heart of Mexico City. La Merced is said to be on a site where Aztecs traded publicly hundreds of years ago. Its several thousand stall holders, themselves once street hawkers, are now the upper crust of the vending world.

Berta Garcia was among the original La Merced vendors. The widow still runs a fresh-vegetable stand within the market with her family because “this is what we’ve always done, and it’s what we know how to do.”

In recent years, however, the family has been forced to venture back into the street outside because, “inside the market, our business is dead. Because of all the ambulantes [itinerants] in the streets, nobody comes inside anymore.”

Now, each year, Garcia informally rents an 18-square-foot site on an adjacent street during the holiday season to sell Christmas figurines. For most of the year, the street is open to traffic. From late October to Jan. 6, the pavement is parceled out to hawkers who pay 3,000 pesos ($370) to the local trader leader for the period.

Pilar Campos, an analyst at the Center for Development Research, noted that street vending is an emotional issue in big cities across Latin America.

The benign view is that street trading is a relatively harmless way to soak up excess labor and provide at least a minimal income for would-be entrepreneurs, she said. The counter-view is that informal trade keeps a whole sector out of the formal economy, encourages undemocratic power plays, erodes the tax base and provides outlets for contraband.

“Before, street vending was easier for the regent to control because he wasn’t elected,” she said. “Now, Cardenas must respond to different constituencies. There are very strong interests here, but he does have the mandate to try something imaginative. And the problem has become so serious that he cannot just wash his hands.”