The Return of the Old Guard: What a PRI Victory Means for Mexico's Future

With the preliminary vote count nearly done, it appears that Enrique Peña Nieto of the PRI will soon be confirmed as Mexico's president elect, ensuring a return to power of a party which ruled Mexico for over 70 years until its 2000 defeat. The idea of the PRI back in power has divided popular opinion. Although there are many who see the "new" PRI as fundamentally unchanged from its old authoritarian origins, many other Mexicans are confident that a strong civil society combined with more robust democratic institutions will prevent any great leap backwards.

The truth is most likely in the middle. Mexico's democracy has gone a long way since 2000, but it is still critically fragile in areas such as transparency, judicial effectiveness and media independence. However, the political environment that the new PRI faces is fundamentally different from the one of 12 years ago when the PAN gained the presidency for the first time. This, more than any factor related to institutional development, could provide the strongest checks and balances. But given the current state of play, what is there to look forward to from a new PRI administration?

The good

On paper, Peña Nieto's economic agenda is solid. Although it does not represent a radical departure from the PAN's open, liberal model (which in effect is a legacy of post-1982 PRI governments) it strikes a better balance between reducing the role of the state in certain key areas such as energy where more private sector involvement is required, and increasing it in others where market forces have so far failed to deliver, such as lending to SMEs. With the PAN's defeat likely to be blamed on its underwhelming economic track record, the PRI will be aware that its own success will hinge on its ability to get the ball rolling on growth (two good years are not good enough) and to address what is undoubtedly most Mexicans' main concern: jobs. More of them, and better paid.

Energy will undoubtedly be the new administration's darling as it holds Mexico's largest untapped reservoir of potential investment. Declining oil production also makes it urgent to obtain the necessary technology for deep-drilling and exploitation of shale gas reserves. As such, we can expect moves to allow private sector involvement to follow quite soon. Crucially, the PRI's proposals for energy reform (the hallmark being a Petrobras-style IPO for Pemex) share much common ground with the PAN's own, which offers hope that legislative cooperation may at last be possible in order to push them through. However, this is still far from a given. The PAN saw its own attempts at reform over the past 12 years (in this and other areas) shot down by the PRI, and there is no reason to believe it will be amenable to give its opponents all the credit for reforms. This highlights the main challenge facing any new administration in Mexico: implementation capacity. Neither Vicente Fox nor Felipe Calderón was particularly successful in transforming their electoral platforms into a plausible policy agenda. With unlikelihood of obtaining the necessary majority in Congress, it will take the PRI's best negotiating capabilities (which are admittedly better than the PAN's) to break the deadlock.

The bad

In the midst of a brutal drug war, security issues have nevertheless played second fiddle to economic concerns during the electoral campaign but they will become a key part of the PRI's domestic and foreign agendas. Peña Nieto's security proposals unfortunately share one common flaw with that of his two main rivals: they are little different from the current strategy of president Calderón. Indeed, the shadow cast by Washington's anti-drug policies looms large, and neither candidate has appeared willing to break from the convention lest they end up at odds with their northern neighbor. Mexicans are also highly supportive of the military and despite the incongruence of opposing Calderón's drug war, would rather keep them on the ground to battle the cartels.

As such, it is difficult to see any fundamental rethinking of the current strategy regardless of its unpopularity and its lack of visible success. Drug groups, particularly the powerful Sinaloa Cartel and Los Zetas, control large parts of the country and it is hardly a secret that their influence runs deep within certain political spheres. Unless the PRI manages some spectacular coups against the cartels, it's difficult to imagine that their power will be significantly eroded during the next term.

The ugly

Make no mistake, this is still the old PRI with a new face. Over the past few years, the PRI has been rocked by a stream of political and media scandals that have tarnished its image as a renovated party. Mr. Peña Nieto has promised that these attitudes will be a thing of the past, and that the PRI will govern democratically. Given the weakness of Mexico's political institutions, it will be left to civil society and the opposition to see that it does. More importantly perhaps, the strengthening of Mexico's powerful interest groups in recent years will ensure that a return to a strong presidency will be nearly impossible: without a legislative majority, the Mexican president is weak by constitutional design. Rather than controlling these interests as it did before, it will have to accommodate or combat them. Unfortunately, the party has shown little willingness to do the latter: in early 1989, shortly after becoming president, Carlos Salinas de Gortari sent the army to arrest the powerful oil union boss known as "La Quina." Few would imagine Peña Nieto doing the same today.

At best, a constructive PRI will see that the path of cooperation, compromise and restraint will be the key to eventually aspiring for another shot at the presidency in 2018. But at worst, an attempt to take its bad habits to the presidency will do the country little good, and will ultimately have the party suffer the fate of the PAN this past Sunday: an unforgiving drubbing at the polls.