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   Vol. 67/No. 45           December 22, 2003  
Mexico rally: ‘No tax hike, privatizations’
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More than 100,000 unionists, farmers, and other demonstrators from around the country jammed downtown Mexico City November 27 in a “National March for the Defense of Sovereignty.” They protested proposals by the government of President Vicente Fox that would open up the electrical industry and other state-owned companies to foreign capitalist investment and that would extend a regressive value-added tax (VAT). Mexican press reports said it was the largest antigovernment mobilization in years. Smaller marches took place in Guadalajara and several other cities.

The demonstration was called by the Mexican Electrical Workers Union (SME) and a number of other labor organizations including the National Workers Union (UNT), led by the telephone workers union. It was joined by large contingents of farmers who came into Mexico’s capital from rural areas around the country. Former Mexico City mayor Cuauhtémoc Cárdenas, a leader of the bourgeois Party of the Democratic Revolution (PRD), led one of the contingents.

In addition to the visible presence of electrical workers, groups of flight attendants, auto workers at Volkswagen, nurses, transit workers, teachers, and other unionists took part in the march.

The largest union federation, the Mexican Workers Federation (CTM), which is tied to the Institutional Revolutionary Party (PRI), the capitalist party that dominated Mexico’s government for decades, did not support the action. The PRI’s grip on the presidency ended in 2000 with the election of Fox of the National Action Party (PAN).

One huge banner carried by demonstrators read, “In defense of the national patrimony, let’s reject privatizations.” Another prominent banner, at the head of a contingent of unions and political organizations, said, “No to privatization, VAT, and imperialism.” “Fox, the homeland is not for sale,” read yet another sign.

In a show of force, the government mobilized 7,000 cops, flying police helicopters overhead all day.

The outpouring of protest was fueled by the economic crisis in Mexico, which has been aggravated by government measures that further shift the burden of this crisis onto working people. Despite Fox’s electoral promises three years ago to improve conditions, unemployment in Mexico today is near six-year highs. The country has not recovered from a recession in 2001. Last year economic growth was an anemic 0.9 percent, and the peso has dropped sharply against the dollar.

The much-touted 1994 North American Free Trade Agreement (NAFTA) has reaped higher profits for U.S. and Canadian capitalists who have gained easier access to markets, investment, and superexploited labor in Mexico. But it has not improved conditions for working people.The Fox government is pressing for economic “reforms” that it says are necessary to increase Mexico’s “competitiveness” in the world, especially with countries like China that are seeking U.S. investment and markets. Big-business commentators argue that, despite the supposed benefits of greater access to U.S. markets through NAFTA, Mexico has “high” labor costs and low productivity compared to China.

One of the main measures proposed by the Fox administration is to extend the VAT—a sales tax—to food, medicine, and books, which had previously been exempt.

The other major proposal is to take further steps toward selling off Mexico’s state-owned companies. The crown jewel, of course, is Pemex, the national oil company, which was expropriated from imperialist corporations in 1938 under the pressure of mass mobilizations of working people. Because of this anti-imperialist legacy, however, Mexico’s oil wealth continues to be deeply viewed by workers and farmers as their national patrimony, making the question of its sell-off a politically explosive issue.

As a result, the ruling capitalists—beginning under the previous PRI regimes—have pursued a course of gradual encroachments on the energy industry, such as the proposal to sell off Pemex’s petrochemical plants and open up the electrical industry to capitalist investors.

SME, the electrical workers union, has spearheaded protests against the sell-off of the electrical industry, knowing it may lead to thousands of layoffs and attacks on the union.

In a September 30 statement, SME said it was seeking to mobilize opposition to those who “seek to turn over the energy patrimony of the Mexican people to foreign capital.”

In face of the continuing protests, the two main ruling parties, the PRI and the PAN, have been divided on how to pursue the privatization moves. Fox is relying on the PRI, which is the largest party bloc in Congress, to help pass a package of unpopular economic “reforms.” After the large November 27 demonstration, the PRI ousted congressional leader Elba Gordillo from her leadership post for being too close an ally of Fox. The president’s economic package remains bogged down in Congress.
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