“It’s all a blur…Whoosh! Men and women were running onto the streets, ignoring the oncoming traffic causing taxis and buses to come to screetching haults. The central boulevard’s stores stood no chance against the purge of goods: people, young and old, ripped leather jackets off the displays on the sidewalks; motorcyclists with bats threatened the elderly shopkeepers; the police stood idly or joined in the desmadre [destruction]… — Teresa Hernandez
“The prestine jewel of the ‘central’ [downtown] was destroyed and emptied: the glass panned Converse store. Individuals who didn’t want to partake in the raids frantically sought refuge in buildings like the Holiday Inn or in strangers’ homes. I saw this from the hotel where I work as a maid. The hotel manager kicked out the employees, claiming that we didn’t need to worry about anything. Clutching my coinpurse, I ran to the bus stop across the street to catch the first bus that came by. Route 12 was packed, not one more soul could squeeze in as the bus doors slammed shut behind me. I didn’t realize my workbag had been snatched away, I was too focused on my coinpurse and getting as far away from downtown as possible. I have never seen anything like this in my life, not here and not in the 70’s in El Salvador. In my country, people stayed quiet or else they got shot; here, they’re very angry and vocal.”
Teresa Hernandez found herself in the commercial sector of Leon, Guanajuato, caught up in the swirl of the chaos sparked by the recent gasoline price “adjustments” in Mexico. The 20-percent hike caused shortages even before it was enacted as consumers lined up to fill up their tanks before the prices spiked: gas stations and attendants faced endless lines in the states of Guanajuato, San Luis Potosi, Vercruz, Juarez, amongst others on December 26th.
Enraged consumers facing inflation, a struggling economy and now the gas-price hike took to the streets, trashing local markets and even raided the aisles at commercial giants such as Bodega (the “Mexican Walmart”) where security guards could do nothing to stop them. “El Gasolinazo”, the name coined on Twitter to describe the price increase and the riots, saw people blockading gasoline stations that maintained reserves; stealing gasoline from unattended pumps; breaking gasoline pipes; protesting outside of major government buildings. The civil unrest has not stopped since the new year and it seems likely it will continue as there is an additional eight-percent increase on the way.
We may dismiss such a price increase as insignificant in the U.S. where a 20-percent hike amounts to about half a dollar per gallon in many places. We might even be inclined to think such a hike would be good to get us out of our cars and into public transporation. But, in Mexico, it’s working people like Hernandez who are going to be hurt the most since most of the population there relies on public transportation and doesn’t have as much disposable income. The price of gas in Mexico is now about $15 U.S, more than three times the minimum wage. When diesel prices go up, so do bus and taxi fares, and when there are shortages, as there were in the latter part of December, everything is exacerbated. A 20-percent hike in gas prices in Mexico isn’t an inconvenience, it’s a crisis.
These graphs will help provide a basic understanding of the situation.
So with these numbers in mind, we begin to realize that this isn’t just about gasoline prices. It’s an indicator that the peso is virtually worthless and the economy is a joke. Regular people like Teresa Hernandez , have to budget extra money for the bus trip every day she commutes to work. It’s only a couple of pesos but every coin counts now. Her sons, Isaac and Daniel, must work twice a as hard to make meets ends as the latter has two little girls to feed. Carlos and Marcos, the youngest in the clan, have dropped out of school to join the workforce and pay for rent which went up to U.S. $3,000 per month (from $2,500 just months ago).
We begin to realize that this isn’t just about gasoline prices. It’s an indicator that the peso is virtually worthless and the economy is a joke.
Essentials such as tortillas, eggs and beans have doubled in price too. People with family in the United States are begging for remittances to get by during these tough times. Students like Chava Castro now have to ask uncles to send money for food since tuition often comes first. “I’d honestly rather starve some days just to let my little brother eat. But I’ll never stop paying tuition. If I stop now, if I take a break, I know I’ll never go back and finish my education,” he says.
Juan Bernardo Calvillo, an engineering student, shares the same sentiment. “My family’s seen tough times,” he said. “My dad put all four of his kids through high school, which in itself is already a huge success in a country where a shoemaker makes the same as a lawyer. He’s already put my sisters through college, but with this economic crisis, he can’t help me. It’s my final year, I have two jobs to pay for school and help my parents with the utility bills. We’re so lucky to be able to afford food and school. Others aren’t so lucky. Things are only going to get worse.”
I’d honestly rather starve some days just to let my little brother eat.
President Peña Nieto has becoe a scapegoat for the crisis and some question whether that is fair — they argue that he doesn’t have full control over the economy or the government. In a recent speech, Peña Nieto attempted to convince the public that the increase was necessary. Additionally, he tried to bolster his reputation by defending the “fact” that his famous reforma energetica (energy reform) had nothing to do with the increase.
Here are some highlights from the speech.
“It is important to highlight that this increase is not a consequence of the energy reform and is also not an increase in taxes.” (00:46)
“The global price of petroleum has experienced a 60-percent increase…Mexico imports 50 percent of its petrolem…” (01:00–01:20)
Peña Nieto claimed that without the gasoline price adjustment, Mexico would have lost $200 billion pesos and the following programs would be threatened:
1. Social Security, for up to four months.
My great grandfather is 95 years old and has never received a decent social security check. The little money he does receive goes into the household food budget.
2. PROSPERA (A hybrid social program that is essentially welfare, the SNAP program, and scholarship programs all rolled up into one) for two years.
Carlos and Marcos were dropped from the program when they were 16 & 14… despite being A/B students as well as being at the bottom of the socio-economic ladder. Over 40 perecent of individuals under the age of 18 drop out of school before finishing high school. Cut the program entirely and you stunt the growth of millions of children.
3. Seguro Popular (Program that grants free health care or reduced costs at public institutions) for an underdetermined amount of time.
Teresa Hernandez lost her daughter to cancer because the Seguro Popular did not cover the cost of certain medications or treatments despite governmental regulations specifically stating that it has to cover cancer treatments nationwide. Juan Bernardo’s parents both heavily rely on the coverage provided by the Seguro Popular as his mom suffers from high blood pressure and his dad needs regular check ups due to his age. Eliminating the Seguro could hurt millions who rely on the program for vaccinations, maternity care and basic care.
Altogether, the government claims, the cuts would have affected “more than a third of the population” had the adjustment not happen.
The first bit of “good” news the president delievered in his speech was that “the government will not receive more tax revenue from the price hike.” However, to maintain programs, Peña Nieto said that 2o,000 government employees will be laid off to cut costs while high-ranking government officials would take a 10-percent salary cut. This, allegedly, saved the Mexican government $200 billion. While that may sound good on paper, it doesn’t appear as though the savings will go to bolster the social programs that would have supposedly been cut without the gas-price hike.
Here’s a quick look at the economy:
- Mexico’s external debt is around $480 billion.
- 80 percent of its exports go to the U.S.
- 47 percent of its imports come from the U.S.
- The Mexican government receieves about 20 percent of its revenue from PEMEX (Petróleos Mexicanos), the state-owned petroleum company.
As you can probably see, many find Peña Nieto’s claims that the government won’t get more funds through the gas-price hike hard to believe. To Mexicans, it feels like a tax increase they can’t afford.
(via https://www.cia.gov/library/publications/the-world-factbook/geos/mx.html)
With half of the population livign below the poverty line, people are growing more impatient with the economy. Peña Nieto has been bashed by the media and public for being nothing less than a “pretty face” and a “puppet.” Corruption has a large part to do with this. People have lost faith in government. News such as this, doesn’t help build confidence.
State of Veracruz pockets funds for children’s cancer treatments & injects them with water claiming they’re receiving chemotherapy
Exacerbating the unrest under Peña Nieto is the fact that it’s been more than two years since 42 students from Guerrero have gone missing and the public feels that nothing has been done about it. Multi-million-dollar properties have turned up under his and his wife’s names that were previously not acknowledged. The pervasive peception is that he has done nothing to combat the corruption within his own political party. To many, the situtation is so bad that a tongue-in-cheek online petition asking President Vladimir Putin for help in fighting the corruption has gone viral:
Closer to home, relations with the United States are at stake. Mexico is dependent on the United States and with President Donald Trump in office, tensions are increasing as Mexican people still resent Trump for saying:
- He will “build a wall” to divide Mexico and the US, and that Mexico will pay for the wall…
- Mexicans are “rapists, criminals and lazy.”
- Mexicans are taking away jobs from hard working Americans both domestically and abroad.
Since Trump was elected:
- The dollar-peso exchange rate has skyrocketed in favor of the dollar.
- The gasoline price adjustment is a way to prepare for the end of current US-Mexico trade agreements as Trump threatens to tear up NAFTA.
- Plans for a multimillion Ford plant to be built in San Luis Potosí was scrapped.
This affects people like Ricardo Bonilla and his two brothers who were hoping to be part of the new hires for the Ford plant. Each has his own family to support. Rents in San Luis Potosí would have been significantly lower and the wages would have been a little better. Now, they have to stay at General Motors working short shifts daily to try to make ends meet.
The country and government is divided when it comes to how to deal with Trump. Some are begging the U.S president to maintain a “peaceful relationship” with Mexico while others are indignant and unwilling to compromise. Citizens across the border are also weighing in:
On Thursday, January 26, President Peña Nieto announced amid the rancor that he was canceling a working meeting President Trump scheduled for the end of January. While Mexicans are probably in favor of standing up to Trump, Peña Nieto isn’t playing the strongest hand. He’s unpopular at home, already deemed “Mexico’s worst president” in decades despite his efforts in the realm of human rights. Perhaps being seen as standing up to Trump will bolster his flagging popularity.
People are mobilizing, and it’s inspiring. The fate of Mexico is uncertain, all we can do is hope for the dust to clear and that the changes people are fighting for will actually happen… for Mexico and Peña Nieto’s sake.
