When Calderon assumed office, many questioned whether he would be able to govern, given the disputed election and vehement protests. Four months later, political analyst Rossana Fuentes-Berain commented, “He has left behind the doubts over whether he will be able to govern.” This shift in perception largely resulted from Calderon’s aggressive response to drug traffickers—a move that could be implemented without having to wait for legislative assent.1
During the first two years of his administration, Calderon sent more than 40,000 soldiers and federal police on anti-drug operations in several states. In the short term, this increased pressure on drug traffickers resulted in an upward surge in violence. Pressure on drug kingpins, many of whom were killed or arrested, fragmented large organizations into ever smaller units that increasingly resembled terrorist cells or guerrilla units. These smaller groups then turned their guns on each other in an attempt to control markets.2
In 2007 and 2008, in marked contrast to the previous presidential term, Congress passed several of Calderon’s reforms. The president put his experience as a legislator to use and consulted with Congress members to draft legislation that would enjoy majority support. Key to his legislative success was his striking a working relationship with the PRI congressional delegation.
One of Calderon’s reforms addressed Mexico’s very low rate of tax collection, which in turn limited the effectiveness of government. His fiscal reform included a minimum tax on business enterprise, marking the first time corporate income has been taxed directly. A special fee for large bank deposits in cash was instituted in an attempt to tax the informal sector. Gasoline and diesel prices were increased. Though far from the major restructuring some thought was needed, the reforms increased government revenue by an estimated 1.1 percent of GDP.3
Another major reform addressed issues raised by the 2006 presidential election. A new law governing elections lowered levels of campaign financing, cut the length of campaigns, and explicitly prohibited individuals, trade unions, or business groups from buying air time to influence elections. Political parties were granted free air time on radio and TV. The power of the IFE was greatly increased as it was placed in the position of middleman between political parties and broadcast media. Parties would deliver their spots to the IFE, which would then place them with broadcasters. This provision was designed to eliminate ads for which no one claimed responsibility—a frequent occurrence in 2006. In what some considered to be an undue restriction on freedom of expression, Article 41 of the political reform law stated, “Political and electoral propaganda which political parties distribute should abstain from denigrating institutions and the political parties and from personal calumny.” Ironically, this article prohibited exactly the kind of attack ads that won Calderon the presidency.4
By far the most controversial of the reforms passed during the early Calderon administration was the energy reform. The president proposed overhauling the legal framework of Pemex and expanding areas where private service contracts were allowed—a move that would permit the utilization of foreign capital and expertise. In response, PRD legislators seized the tribunals of both houses of Congress to force debate on the issue before the passage of the bill. The final bill coming out of Congress gave Pemex more administrative autonomy and allowed it to provide cash incentives in the contracts it wrote with other companies. However, it fell short of the sweeping changes many felt were needed to draw in major foreign oil companies. By keeping oil firmly in government hands, the law reflected the feelings of a substantial majority of Mexicans that oil production should remain nationalized.5
One of the biggest political surprises of the early Calderon administration was the political recovery of the PRI, under the leadership of savvy president Beatriz Paredes, former governor of Tlaxcala. Of the 297 state legislative seats up for election in 2007, the PRI won 43 percent, as well as 59 percent of the mayoral elections. The party, rather than trying to embarrass the president as it did during the Fox administration, sought to emphasize that he was a capable administrator.6
The PRD’s fortunes under Calderon were the direct opposite of the PRI’s. Lopez Obrador’s prolonged demonstrations protesting the presidential election and his refusal to recognize Calderon as president played well to the PRD’s radical wing, but cost substantial support among other voters. To compound its problems, the party was sharply divided between more radical followers of Lopez Obrador and the more moderate faction known as the New Left (Nueva Izquierda), which sought to reposition the PRD as a moderate social democratic force. This dispute spilled over into an internal party election to choose the PRD president. Protests flooded into the IFE, claiming that PRD members were trying to steal their own election. The messy election and the failure to recognize Calderon seriously undermined the party’s attempts to build its image as a party capable of managing Mexico.
As the mid-term of the Calderon administration approached, Mexico found itself gripped in the world recession. The government’s rather tepid response was criticized by many, including former Mexico City Mayor Manuel Camacho Solis, who stated, “The government did not anticipate the severity of the crisis and still lacks a response which reassures the markets and society.” Even before the full impact of the 2009 recession was felt, the progress the Fox administration had made on poverty reduction was reversed. In 2006, 42.6 percent of the population lived in poverty. Two years later, 47.6 percent of the population—50.6 million Mexicans—lived in poverty. Much of this increase in poverty was produced by an increase in food costs.7
World History
