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State Of Siege For Mexico's Rulers


International Business: MEXICO

STATE OF SIEGE FOR MEXICO'S RULERS

Furious voters may clobber the PRI in midterm elections

An election backlash against corruption and violence in a state just south of Mexico City spells deepening woes for the long-ruling Institutional Revolutionary Party (PRI). Opposition parties won control of the Morelos legislature and four major cities in Mar. 16 elections.

The upset, presaging a potential PRI rollback in July's midterm elections, underscores the continuing erosion of the PRI's 68-year grip on power. A rash of drug scandals is adding to voter disgust. And despite the economy's gradual revival from a crushing recession, the benefits haven't yet trickled down to most Mexicans' paychecks. "People want change," says Juan Sanchez Navarro, vice-president and executive director of leading brewer Grupo Modelo. "We're witnessing the awakening of civic awareness in Mexico of a kind that hasn't been seen" since the 1910 beginning of the Mexican Revolution, he says. That means President Clinton will encounter a country in ferment when he visits Mexico on Apr. 11.

PROBERS. Following the mid-term elections, President Ernesto Zedillo Ponce de Leon may face a Congress eager to start investigations into corruption and a Mexico City mayor eager to make the capital into a showcase for opposition rule. Basic Mexican economic policies are unlikely to change, because the PRI may retain a plurality in Congress and the conservative National Action Party (PAN) often sides with the government on economic issues. But both the PAN and and the left-leaning Party of the Democratic Revolution (PRD)--whose candidate, Cuauhtemoc Cardenas, leads in most polls to become the first elected mayor of Mexico City--will fight for more spending. That could slow Zedillo's economic reforms. While foreign investors may take such democratic turbulence in stride, the question is whether Mexican investors will get jittery and hoard their money or bolt.

The PRI has been counting on the economic recovery to help recoup the political losses it has suffered since the December, 1994, peso collapse triggered a deep recession. The PAN already governs four states and the six largest cities outside the capital. Now, the Morelos results show that, with crime out of control and salaries yet to recover, Mexican voters aren't satisfied with rosy economic forecasts. Early returns showed that the PAN won the city hall in Cuernavaca, the state capital, while the PRD captured three cities and the legislature. The vote was a repudiation of the state's PRI governor, Jorge Carrillo Olea, whose three years in office have been marked by violence, including an epidemic of kidnappings. Although Mexicans are less concerned about drugs per se than about the spread of all kinds of crime, Carrillo Olea's reputation took a further blow with a report in The New York Times alleging that he had protected drug traffickers, a charge he denies.

HOPELESS? The latest PRI setback was the Mar. 17 arrest of an army general on charges he offered $1 million a month in bribes on behalf of Mexico's most lethal drug cartel. This followed last month's arrest of the country's former antidrug czar for alleged drug ties. "Every piece of news reconfirms the opinion of a growing number of the electorate that the system is relatively hopeless and it's time to sweep the the PRI out," says political scientist Federico Estevez.

So far, opposition parties have downplayed drugs in campaigns against the PRI. They see the scandals as just a facet of the wider corruption engendered by one-party rule. "It's the most recent chapter in a long history," says Carlos Castillo Peraza, PAN candidate for Mexico City mayor. A nationalist backlash against the debate in Washington over U.S. "certification" of Mexico's drug policies may have helped the PRD, the most nationalist of the three parties, says Vicente Licona, director of the Mexico City polling firm Indemerc Louis Harris.

So far, the drug scandals appear to have left the recovery unscathed. But as opposition parties gain strength, Washington will need to reassess how it does business with Mexico. The PRI is "the old-guard elite that has lost control and doesn't realize what kind of trouble it's in," says one U.S. Senate staffer. That causes jitters about what could follow. "When you lose the PRI," he adds," you don't know what will happen." These days, even with the PRI still in power, there's no way of knowing.By Elisabeth Malkin in Mexico City


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