Jose Lopez Portillo, 83; Former President Led Mexico in Boom and Bust

Former President Jose Lopez Portillo, who led a free-spending, corruption-ridden oil boom only to watch its collapse plunge Mexico into one of its worst financial crises, died Tuesday night. He was 83.

The former president, who was using a wheelchair, had been admitted to Angeles del Pedregal Hospital here Monday with pneumonia. His son, Jose Ramon Lopez Portillo, said he died surrounded by about 50 relatives and close friends.

More an intellectual than a politician, Lopez Portillo served as president from 1976 to 1982, at the peak of the Institutional Revolutionary Party’s seven decades of autocratic rule. Mexicans’ disillusionment over the currency collapse during the final months of his term was a factor in the slow erosion of authority that eventually toppled the party, known by its Spanish initials of PRI, from power in the elections of 2000.

The discredited leader gained infamy by swearing in 1982 to defend the peso “like a dog,” just weeks before its plunge from 22 to 70 per dollar, the steepest drop in Mexican history. Facing the nation in his final major address that September, he blamed the crisis on bankers and, with the stroke of a pen, he nationalized the banks.

Then, speaking on national television before a joint session of Congress, he broke down in tears, begging the forgiveness of Mexico’s impoverished millions. But rather than forgive, they reviled him and dubbed his private mansion “dog hill,” prompting him to leave Mexico for a long self-exile in Europe.

Born June 16, 1920, Lopez Portillo studied law at the National Autonomous University of Mexico. His father was a soldier, engineer and historian who struggled to make ends meet. The young Lopez Portillo fancied himself a Renaissance man, teaching political science at his alma mater, painting canvases, boxing, practicing law into his 40s and showing little interest in politics.

At his own expense he published a bizarre pamphlet called Don Q., in which, half joking, he saw himself as the latest incarnation of Quetzalcoatl, the plumed serpent of Aztec mythology.

But in 1958, after joining the PRI, he was drawn to politics by his admiration for President Adolfo Lopez Mateos and moved up, slowly, through the ranks of public administration.

Under President Luis Echeverria, a friend from his student days, Lopez Portillo became a figurehead minister of finance and, in the PRI tradition of presidential selection, Echeverria’s handpicked successor.

A skilled orator and horseman, the charismatic new president took office with what many Mexicans considered a sensible message after the demagoguery and political strife of the Echeverria years. Mexico was suffering its worst recession since World War II, and Lopez Portillo promised to heal the nation, stabilize the economy and launch an era of growth.

But he had no political experience and showed little taste for the business of governing. Leaving that task largely to aides, he wandered through the corridors of the National Palace, looking at pictures of his predecessors, joking about his near-effortless rise to power.

Thanks to his ministers, Mexico’s economy had stabilized by the time a recalculation of oil deposits discovered in the early 1970s led the president to realize that the country was far richer than imagined.

His moderate spending plans went out the window. He promised “an administration of abundance,” but led Mexico on an inflationary spending boom far beyond its means. Vast sums were wasted in bureaucratic salaries and investments that produced little yields or even losses.

His administration became characterized by some of the worst nepotism and graft in modern Mexico. His son, Jose Ramon, was made assistant minister of programming and the budget, but the president often called him “the pride of my nepotism.” Lopez Portillo, who was married with two other children, made his mistress, Rosa Luz Alegria, minister of tourism.

By 1981, when the oil boom went bust, 87 cents of every dollar of assets held by Pemex, the state oil monopoly, were owed to foreign banks. The debt was one-fifth of the country’s total foreign debt.

And in the month before the peso collapsed in August 1982, a crisis of investor confidence sent $9 billion out of the country.

Shortly after leaving office in disgrace, Lopez Portillo divorced his wife, Carmen, an amateur pianist. He took up with Alegria, with whom he lived in Spain. They split up and he later married retired film star Sasha Montenegro, with whom he had two children. They returned to Mexico in the late 1990s.

In recent years, Lopez Portillo had been in poor health, undergoing emergency double bypass heart surgery in 2001 to repair damage caused by blockage in his arteries.

In February 2003, he was hospitalized to treat ulcers on his legs. And doctors cited respiratory and heart problems when the former president was hospitalized this week.

“I do not enjoy perfect health; perhaps I am paying for my sins,” he said after the bypass surgery.

Last year, a special prosecutor said he intended to summon Lopez Portillo for the disappearances and deaths of scores of leftists during his administration. He was never called.

“He died in peace, with his family and with his conscience clear,” Jose Ramon said.