Mexico News and Analysis - November 10-16, 2008

1. CALDERON NAMES NEW INTERIOR SECRETARY
2. INFLATION HITS POOREST CONSUMERS
3. ORTEGA WINS PRD PRESIDENCY


1. CALDERON NAMES NEW INTERIOR SECRETARY
Six days after a plane crash claimed the life of Juan Mouriño, President Felipe Calderon named a new Interior Secretary.  The choice of Fernando Gomez Mont came as a surprise to many analysts and broke with Calderon’s tendency to name inexperienced but loyal cabinet members.  Gomez Mont is a well-known lawyer and long-standing member of the National Action Party (PAN).  His father, Felipe Gomez Mont, was a founder and principle ideologue of the PAN.  He is close to Diego Fernandez de Cevallos, one the most polemic, corrupt and conservative figures in PANismo. 

During several decades as a lawyer, Gomez Mont defended many high profile cases involving important political figures, including Raul Salinas de Gotari, brother of former President Carlos Salinas de Gotari, who was charged with corruption and receiving illicit funds from drug trafficking.  In one of his first high profile cases in 1994, Gomez Mont successfully defended Carlos Cabal Peniche against corruption charges.  This led to a series of important corruption cases in which he defended high level officials, including Tomas Peñaloza, former treasurer of the IMSS, Gerardo de Prevoisin, former Director of Aeromexico, Jorge Lankenau, former bank executive, and Rogelio Montemayor, former Director of Pemex.  He served briefly as a federal Deputy along with Calderon during the 55th legislature, but has held no other elected office.  However, Gomez Mont knows Mexico’s electoral system well, having served as a member of the Federal Electoral Commission and as the PAN representative to the Federal Electoral Institute.  He vigorously defended PAN electoral victories over the past decade, including the fraudulent election of President Calderon. 

During his formal presentation of the new Interior Secretary, President Calderon emphasized that his administration would not negotiate agreements with Mexico’s increasingly violent drug cartels.  Calderon may have felt obliged to make this statement given Gomez Mont’s defense of drug dealers and corrupt government officials, as well as the defense of members of the Sinaloa cartel by his close friend and political ally Diego Fernandez de Cevallos.  The new Interior Secretary will likely focus on Calderon’s most important current political initiatives, including reform of the justice system, establishment of a unified national police force, and the 2009 mid-term elections.  The next election cycle could prove decisive for an increasingly weak President Calderon.  Most experts expect the PAN to suffer significant loses at local, state and federal levels, which could leave an already fragile Calderon administration as little more than a caretaker government for the next three years.  In this context, Gomez Mont’s broad experience with electoral dynamics could portend manipulation or fraud during the mid-term elections.  The Interior Secretary is the second most powerful position in the Mexican government and is traditionally seen as a stepping stone to the presidency; however, Gomez Mont is unlikely to vie for his party’s nomination in 2012.  Look for Gomez Mont to serve through the 2009 elections, then be replaced by someone closer to Calderon. 


2. INFLATION HITS POOREST CONSUMERS
Rampant inflation during the first two years of Felipe Calderon’s presidency is hurting the poorest consumers most.  Since December of 2006, the cost of the basic food basket (CAR – an important measure of costs particularly for the poorest consumers) increased by 43%, while the minimum wage increased by only 8%, according to a report by the Center for Multi-disciplinary Analysis of the Economic Faculty of the UNAM.  Almost two-thirds of Mexican workers earn three minimum wages or less.


3. ORTEGA WINS PRD PRESIDENCY
The Federal Electoral Tribune (TEPJF) awarded Senator Jesus “Chucho” Ortega, leader of the New Left wing of the PRD, the party’s presidency this week, nearly eight months after highly controversial elections marred by fraud left the party badly divided.  In a unanimous decision, the TEPJF gave the disputed election to Ortega by a margin of 35,000 votes, despite widespread fraud documented during the competition.  Ortega filed a formal complaint with the TEPJF, but his nearest competitor, former Mexico City Mayor Alejandro Encinas, refused to file with the Tribunal.  Encinas is close to former PRD presidential candidate Andres Manuel Lopez Obrador, who lost a fraudulent 2006 election after the TEPJF lined up behind current President Felipe Calderon.  The Tribunal’s ruling noted that 23% of voting booths produced fraudulent or unreliable results, yet awarded the election to Ortega despite internal PRD rules that require a new election if more than 20% of votes are thrown out.  Because Encinas refused to file a complaint with the TEPJF, the Tribunal only annulled voting booths contested by Ortega.  Encinas called the ruling an unacceptable intrusion in the party’s internal affairs and called on Ortega to refuse to recognize the decision.  Ortega called on Encinas to co-govern the party by accepting the post of Secretary General.  Both party factions are concerned about mid-term elections in 2009.  Most experts predict that the badly divided PRD will lose power at all levels of government.  Ortega is even considering strategic alliances in certain races with the PAN or PRI.  Meanwhile, Lopez Obrador’s wing of the party may break with the PRD and align itself the Workers Part (PT) and Convergencia.  Both smaller parties are looking for new political life and would welcome an alliance with Lopez Obrador after election reforms passed earlier this year weakened their prospects.  While Ortega controls much of the PRD bureaucracy, Lopez Obrador can turn out votes.