Politics: Bringing business to heel
A unique dinner party reported by the media that took place at the National Palace nine days ago embodied the curiously ambiguous relationship President Manuel Andrés López Obrador has established with Mexico’s business class. The country’s wealthiest and most powerful business leaders were in attendance, but unlike on previous occasions, where such an event was held ostensibly to “discuss” investment commitments and economic policy matters, the invitees were notified it would be about one of the president’s pet causes, helping him unload the presidential plane inaugurated by his predecessor that AMLO had long decried as an unjustifiable luxury. While the plane has spent a year in a California hangar begging a buyer, AMLO decided earlier this year to raffle it off. A few days before the dinner, however, he decided the raffle tickets emblazoned with the Boeing Dreamliner would not deliver the plane, but instead up to 10 grand prizes in cash worth 20 million pesos each.
Each attendee was handed a suggested “donation”, and 75 of those on hand dutifully coughed up a combined 80 million dollars. Some business leaders were openly dismissive, and one prominent academic described it as a shakedown, but most of the top business class, including many of the heads of the main industry associations, have opted for projecting an open collaboration with the regime. That relationship includes not only validating whatever pops into the president’s head at any given time, but also avoiding any direct confrontation with the government over public policy decisions, even those that are clearly to the detriment of business activities, such as cancelling the oil bid rounds.
They are responding in part to the real concern that they may find themselves politically motivated targets of Financial Intelligence Unit and Tax Administration investigations, major project cancellations (e.g., the Texcoco airport) or other impulsive policy decisions by the president. Many others also see the possibility of business opportunities from an administration that will be in office for almost another five years of AMLO’s constantly shifting projects.
None of this is likely to stem the fall in investment, but it can significantly erode the ability of industry associations to positively shape economic policy, and otherwise undermine their authority, especially in the eyes of many of their own members.
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