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Emerging Leaders

Emerging Leaders

September 2011

Felipe Calderón Hinojosa, President, Mexico

“I’m fighting corruption among Mexican authorities and risking everything to clean house.”

— Felipe Calderón in an interview to MSNBC

Back in the summer of 2006, Mexicans who braved the hot sun and queued up in long lines to elect the country’s president gave a worryingly indecisive mandate. Of the 41 million votes cast across the country, the difference in the number of votes secured by the top two candidates was just 240,000, a number too close to call the results of the election immediately. The man in the lead was Felipe Calderón Hinojosa of the mildly conservative National Action Party (PAN). His opponent was Andrés Manuel López Obrador, a leader belonging to the leftist Democratic Revolution Party (PRD). When the final results were announced on the counting day, Calderon’s total vote share stood at 35.9%, a slender lead over his opponent’s 35.3%.

As the country’s electoral officials struggled to declare the clear winner of the elections, both of the top two contenders declared themselves as the victors. Soon after, Obrador, who trailed Calderón, alleged irregularities in the tally and urged a recount of votes. He even challenged the election results before the country’s Federal Electoral Tribunal. But two months after the election date, the Federal Electoral Court ruled against Obrador.

Calderón who had won the elections earlier eventually won the battle of nerves as well.

Calderón sustained his grit going into his inauguration in the National Congress. Obrador’s supporters, who thought Calderón lacked almost half the country’s support to rule, jeered and booed at the incoming president. But amidst the cacophony Calderón kept his cool. He began his four-minute inaugural address to the National Congress steadily and quieted the crowd by singing the country’s national anthem. He then neatly marched out through the back door. Arnold Schwarzenegger, the then governor of California, who was watching the ceremony from one of the grand balconies in the historic building, chuckled. “It is good action” he remarked.

Calderón did not acquire his political skills or his astuteness overnight. It is a skill that was polished over a period of 25 years on the ground. In fact, some of Calderón’s supporters say that he hit the campaign trail even before he was born: his mother, carrying Calderón in her womb, actively campaigned for her husband Luis Calderon Vega, a political activist and one of the early members of the National Action Party (PAN).

From then on, the younger Calderon was a regular in his father’s campaigns. As a boy he distributed party pamphlets and flyers supporting PAN. He went clinging with the campaign vehicles of his party candidates, hollering slogans supporting his party. But despite the family legacy that Calderón enjoyed, he was mostly on the losing side of politics for a major part of his youth. For more than seven decades, starting from the late 1920’s, Mexico was ruled with an iron fist by the Institutional Revolutionary Party (PRI). Observers noted that the PRI’s hold on many institutions made it quite difficult for opposition parties to make any meaningful headway up to the highest office of the country.

All through this time Calderón labored for candidate after candidate belonging to the PAN only to see them lose by a substantial margin to well-healed PRI candidates. But these losses taught Calderón one of the integral lessons of electoral politics: the art of being patient. As he plodded through the electoral landscape of Mexico in the 1990’s, Calderón believed in one firm opportunity: an alternative to PRI. That opportunity came when the PRI crumbled under its own weight in the late 1990’s due to economic mismanagement and corruption.

Yes, we will win (the drug war) and of course there will be many problems meanwhile.

— In an interview to Associated Press

When PAN, with the help of a coalition, finally unseated PRI in the historic 2000 presidential elections, PAN’s candidate, Vicente Fox, became the president of Mexico. Calderón joined Mr. Fox’s cabinet as an energy minister. Calderón himself became the president after winning the closely-fought election with the PRD’s Obrador in 2006.

Calderón’s four and a half year stint at Mexico’s helm has largely been characterized as a mixed bag by political observers. But the boldness and decisiveness of its leader has gained unquestioned attention. Soon after his election he brought meaningful pension reforms to the country’s public-sector. Many commentators suggest that his structural reform could help Mexico get its budget and the fiscal situation right. To get his reform through the country’s legislature he courted, cajoled, and coerced opposition politicians, trade unions, and state governors.

Calderón also wound up the operations of a powerful, union-supported but grossly inefficient state-owned electricity distributor, Luz Y Fuerza del Centro. The state-owned entity’s overly generous wage bill for nearly 44,000 workers and 22,000 pensioners was bleeding the Mexican government of nearly $3 billion a year. What’s worse, the company almost lost 30% of all the electricity it generated by way of power thefts and technical glitches. On the day he announced that he would be closing the utility, without a warning to anyone, he deployed 1,000 federal police officers with riot gear to the company’s gates to show his determination to close an ineffectual entity.

Despite PAN being viewed as a business-friendly party, Calderón then went to great lengths to ensure competition between industries. Understandably, this ruffled the feathers of established monopolists. Monopoly in the telecom industry, in particular, is largely reported to be a factor hampering Mexico’s ability to attract many other foreign and domestic businesses. Calderón publicly took on Carlos Slim Helu, one of the world’s richest men and the majority owner of American Movil SAB, a telecom firm that has a dominant share of the country’s telecommunications markets. American Movil’s dominant position is largely viewed as contributing to Mexico’s high mobile phone and internet tariffs. “I really respect Carlos Slim, or any other Mexican enterprise, but at the same time, I am the authority and I need to regulate the market in order to avoid monopolistic practices,” Calderón said in an interview to Bloomberg.

Although there have been substantial improvements, the past four-and-a half years of Calderón’s leadership also saw a series of stunning setbacks for both Mexico and his party. The leader’s decision to send in the country’s army to deal with the dominant drug cartels in northern parts of Mexico, bordering the U.S., stirred the hornet’s nest. When Calderón took charge in 2006, deaths related to drug-cartel related violence stood at around 2,000. But Calderon’s tough strategy of eliminating drug lords aggravated the situation creating a nasty war between drug lords, the general public, and the state forces. Add to this the bloody succession wars among drug gangs, and the number of human loss in 2010 jumped to almost 30,000 according to the BBC. This, along with illegal immigration, has been a frequent source of clash between Calderón and the U.S., although the Mexican president has generally maintained cordial relations with the superpower. His shortcomings in the effort to sell a part of the state-owned oil company, Pemex, have also dented his reformist credentials.

Despite his efforts to reform the country, many experts do not give high marks to Calderón for his handling of the country’s economy. Since PAN took power in 2000, the personal income of Mexico’s citizens has grown at an average rate of less than 1%, one of the slowest paces among developing economies. Nonetheless, Calderon has been widely lauded in the way he confronted dire poverty across the country.

In the past four and a half years of Calderón’s rule, Mexico indeed saw some much-needed action as Calderón sought to reform a nation that was bogged down by drug violence, corporatism, political infighting, and an increasingly uncompetitive economy. For all his faults, however, observers say Calderón’s no-nonsense approach for many of Mexico’s problems woke the country from a deep slumber. Although his approval numbers have dipped recently, Calderon is ruling Mexico with a meaningful decisiveness even though his fellow citizens gave him only an indecisive mandate. Despite setbacks, the 49-year old Harvard-trained economist has trudged along in the unforgiving world of Mexican politics, thanks to that one fine quality that gave him the job in the first place – grit.





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