Reuters World News - Mexico’s new president takes office. What lies ahead for Claudia Sheinbaum?

Episode Date: September 28, 2024

She’s a climate scientist and the first female to take the highest office in Mexico. As Sheinbaum starts her term, she faces challenges internally and externally. Listen to Mexico City based journalists Cassandra Garrison and Stephen Eisenhammer as they explore Mexico's strained economy, diplomatic relations with the U.S., Sheinbaum's possible approach to Mexico's organized crime cartels, and more. Learn more about your ad choices. Visit megaphone.fm/adchoices

On Tuesday, Claudia Shinebaum takes office as President of Mexico. On this special episode, we look at the challenges awaiting Shinebaum, a strained economy that's been shaken by recent judicial reforms, balancing diplomatic relations with the United States, and addressing violence and organized crime. I'm your host, Christopher Waljasper, in Chicago. To help us understand the significance of Shinebaum's president, presidency, Cassandra Garrison and Stephen Eisenhammer are joining me now from Mexico City.

Cassandra has covered everything from politics to climate and agriculture in Mexico, while Stephen is our Mexico Bureau chief overseeing everything from politics to investigative projects. Thank you both for joining me. Thank you, Christopher. Hi. So to begin with, let's put into context the significance of Claudia Shinebaum's election. It's an incredibly historic moment for Mexico to, be inaugurating its first woman president. It is a surprising in a way that it's happening because Mexico

is historically a country with a very macho kind of masculine driven culture. It has one of the highest femicide rates in the world. Violence against women is incredibly prevalent and there's still major socioeconomic differences between men and women in Mexican society. So to be ushering in its first woman president at a time like now is incredibly important. for Mexican women, and I know that many have hoped that she will be a champion for them. She has been a vocal proponent for many women's issues. She was a public supporter of legal and free abortion, but her critics would say she hasn't done enough yet. So I think that Mexican's feminist movement and just women voters in general are going to be watching very closely what

kind of moves she makes for the women of Mexico and how she chooses to position herself in feminist issues. What do we know about Shinebaum personally? She's a scientist in every sense of the word. She's incredibly intelligent, highly intellectual, but she's also very well rehearsed. We see a different style from her than we've seen in the very charismatic, talkative Lopez Obrador. So you're going to see her be very scripted, have very prepared answers to questions. So she's definitely a bit more buttoned up, but from what we hear from people inside her government and her closest advisors during her campaign, she is personally involved in every issue she wants a plan. She wants her advisors to come up with detailed options for how to address Mexico's largest problems. And

she's personally involved in making those decisions and making sure that she's just abreast of every issue going on in her government. And we've seen that style of leadership when she was the mayor of Mexico City. What does that tell us about how she might lead the country? Sure. So she's the first woman to be elected to the role of mayor of Mexico City. And she had several accomplishments specifically in environmental and climate-friendly policies. For example, she installed a major rooftop solar project at one of the busy central markets of the city. She inaugurated a 100% electric bus line. But she also went through very difficult times in her mayorship as well. For example, the COVID pandemic hit while she was in office and that was a very difficult time for Mexico City. Death rates were high,

hospitals were overwhelmed. She also faced some criticism for some of her policies of the construction of a bridge in the Zocci-Milko ecological zone, for example, that some of the indigenous populations and community members in that area complained that were damaging wetlands. And she's been a major supporter, pretty much of all of Lopez-Ovador's major infrastructure projects. But at the same time, she's going to find it challenging, I think, to break away from Lopez-Obrador. style too much. She could risk losing support of voters who wanted to see continuation of his mandate. And that could essentially limit her ability to prioritize some of those climate change and environmental policies. Now, Scheinbaum is a member of Lopez Obrador's Morena party.

How might that inform her time as president? So Morena is a party that intends to differentiate itself from the political corrupt elite of Mexico's past. And so, So it appeals to Mexicans who were tired of not feeling like they had a choice, not feeling like they had any control, and that the political elite was doing whatever they wanted in the country as a way to change that. And they intend to end corruption. That's one of the main platforms of the party. One of the main cornerstones is ending impunity, holding corrupt leaders responsible.

Whether they've been able to accomplish that is another story. But that is probably the main principle of Morena. Yeah, I think that's spot on. And, you know, one of the really interesting things, with Morena is that really it was founded by Andres Manuel Lopez Obrador, better known as Amlo, who's the figurehead and kind of father figure of this party. And that's why this change of power is so interesting, right? It is a whole question as to how much influence he's going to carry on having under Cardia Scheimbaum. He's very much her mentor. And so there's this is open question of

will he fade into the background like Mexican presidents have done in the past? Or is he going to carry on exerting influence as the kind of founder of this movement. And as Cassandra said, he sees it as a kind of transformational movement in Mexico's political history. He refers to it as the fourte, the fourth transformation of Mexico. It's not just a kind of political party, that is really something that is transforming the country in a kind of a historic way. So what are the challenges Scheimamo face and how my Lopez-Obrador's legacy that play into them? The country has one of the highest deficits that it's ever had. We've got a peso that's a lot weaker than it was even since June, since her election. And she's going to be challenged to reset diplomatic relations with the U.S. and Canada in the midst of security problems. Tensions over the recent judicial reform, which both the U.S. and Canadian ambassadors had spoke out against and criticized. And in response to that, her predecessor suspended diplomatic relations with those embassies.

So she's got a lot on her plate from day one. And Mexico does look very different, not only from six years ago, but even since June when she was elected. Yeah, I think Amlo leaves a pretty interesting legacy, I think on the security side, even though homicides have come down over his presidency. There will still be more people murdered over his six-year term than under any other kind of modern Mexico. and there are fears that cuts that he's made via austerity to the judicial system and the national police force, there's a kind of slow burn in terms of giving more space to organise crime, allowing them to strengthen and deepen their influence in certain parts of the country. And the other interesting thing is that under Amlo, you've had the poor have done better, right?

He's done a lot of direct cash transfers, really improved the welfare, the poorest receive in Mexico. But one of the ironies is that the very rich had done very well. Amlo hasn't increased taxes. It's been one of the things that he's done. He's really paid that welfare through cuts to other parts of the state and the idea that the state was bloated and needed to be cut down. Quite an odd opinion really for a kind of leftist leader. And so it's really the middle class that have kind of been squeezed under Amlo. The forecasts aren't great in terms of growth over the next couple of years. And that's going to be another challenge for Schaimbaum. Okay, so let's dig into some of those issues. Let's begin with Amlo's decision earlier this year to reform the judiciary.

What exactly do these reforms do and how might they impact the early days of Scheimbalm's presidency? The judicial reform seeks to overhaul the system by implementing elections by popular vote for thousands of judge positions. It reduces the amount of necessary work experience for Supreme Court justices. and some other positions. And the aim of it, according to Amlo, is to reduce corruption to make judges less susceptible to outside influence and to end impunity. So this is really going to be overseen by Shanebaum. It will be her job to implement it. And it will also be her job to manage the fallout. Markets reacted over fears that it's just too much of a concentration of power by the Marina party. Not only do they have a strong majority in the lower house and Senate, but now it would be

seen as perhaps having this influence over the judicial system as well. And also the concern that just democracy is kind of on the backslide in Mexico with this doubling down of power. And Shane Baum will have to manage these fears. She'll have to probably meet with the business community, international investors to try to reassure them that Mexico is still a safe place to do business, that there's not going to be major changes, that the judicial system will remain fair and impartial, and she'll have to also work on repairing those relationships with the U.S. and Canadian ambassadors,

which have been strained since the digital reform really started getting pushed in the last couple of months. Yeah, I think that's absolutely right. No one's saying that the judicial system in Mexico was great. Actually, almost everyone criticizes it, but at least investors knew kind of what they were dealing with. And I think what we're looking at now is a period of, of, of massive uncertainty and lack of clarity as to what's going to result from this.

And another aspect of it is the challenge of organizing all of these elections. We just had a really big election, right? And it was the bloodiest election in Mexico's recent history. And that's one of the other fears, right? That you're opening up another part of Mexico public service positions to the threat of violence, the threat of organized crime and the attempts of illegal actors of trying to influence the judiciary. Now, Lopez Obrador has defended these judicial reforms as being necessary, saying that the current system doesn't serve the people. He also says the reforms will reduce corruption and even minimize the influence of organized crime.

Has Scheinbaum been supportive of these reforms? Yes, she's been a vocal supporter of it. She believed that the reform was necessary, and she's backed it from the beginning, as she has with many of Lopez Obrador's main projects and reforms. But we have heard from sources that it wouldn't have been her priority, right? It's not, she's not thrilled people close to her say about starting her presidency with such a crisis. There's no honeymoon. It's very much coming in in kind of damaged limitation mode. And I think she supports the policy in general, but she would have looked to do it at a different time. Now, as you noted, violence, largely associated with organized crime, continues to be a problem

across Mexico, what's Shinebaum's plan to address the cartels and their influence? So Shinebaum has really kind of stressed the success that she had in Mexico City, bringing down crime and in professionalizing the police service. She's said that that's what she's going to do nationally as president. She's going to improve investigations. This is one massive issue in Mexico. It's just the kind of tiny number of successful prosecutions, the result from really serious crimes like murder and things like that. And so she's really kind of got that in her

sights as something that she wants to improve. She's brought in the guy that the ran security for the city, Hard Fush. He's going to be her main national security guy now and in charge of really trying to rein in the cartels. But I think it's going to be a big challenge. I think no one doubts that Shimbabham was going to approach it in a different way that Amlo did. Amlo famously had this quote, you know, hugs, not bullets, this idea that you should be treating the kind of root causes of violence and criminality, basically in his view, poverty, right, and lack of development. And that kind of you need an outstretched arm as opposed to a rifle to kind of treat organized crime in Mexico. I think Claudia is going to bring in some of that, but he's going to combine it

with at least what she hopes for a more effective police system and cooperation with prosecutors. But as I say, I think it's going to be a challenge because a lot of experts that you talk to will say that AMLO's policy has increased the reach and influence of organized crime. And the fentanyl crisis in the US is a massive revenue stream for them. The profit margins on that are absolutely enormous. So you do have very powerful, well-armed organized crime groups in Mexico. In response to criticism that his policies have emboldened organized crime, Lopez Obrador says that his strategy is meant to address the root cause of violence, ensuring that young people have options for work and study.

How is Scheinbaum looking at the flow of migrants from Central and South America through Mexico? I know it's been such an issue in the U.S., but I imagine it's viewed differently in Mexico. Yeah, there's almost a kind of paradox in Mexico about the way that the government, and this is the same for Amlo, and I think it will be the same for Scheimbaum, sees the migration issue. On the one hand, as a kind of leftist party and obviously representing what they claim is grassroots Mexico, there's a lot of sympathy on one level with migrants, with Central American migrants. And so as a result, there's always been a hesitancy about the kind of U.S. discourse and kind of way of seeing the migration problem. But that said, under Amlo, and I suspect this will carry on under Shaiyam, there has been a lot of Mexican enforcement in terms of stopping migrants from reaching the US border, busing them back south or flying them back south, occasionally with deportations, not issuing the kind of paperwork that they need in order to cross through Mexico legally. And so all of that has been a real area where there's been cooperation and negotiation with the, you know,

U.S. Now, sticking with U.S. relations, how might Shinebaum work with the next U.S. president, whether that be former President Donald Trump or Vice President Kamala Harris? As mayor of Mexico City, she didn't have a lot of experience working with U.S. leaders one-on-one, so this would really be her first time interacting with them at that really personal level. I think if the U.S. elects Trump as its next president, there might be a change in relations. He's talked a lot about implementing a major deportation operation. He's talked about deploying U.S. troops to the border. And he's also talked about imposing tariffs on cars imported from Mexico.

So what we've heard from her thus far is that maintaining strong ties with the United States is very important. The U.S. is a major and significant ally to Mexico. But the priority is Mexico's sovereignty, sort of gently sending the message that it's not a good idea on the U.S. side to threaten these types of economic consequences and maybe pressure Mexico with trade threats, as we saw from Trump in his first presidency. I think that if the U.S. elects Harris probably have more amicable diplomatic relations than what we would see with a potential President Trump. I think in many ways the U.S.-Mexico relations,

improved under Biden. So I think there'd probably be a continuation of that if the U.S. were to elect Harris. Also, you know, it goes without saying that there'd be a lot of attention around that relationship because Shanebaum's obviously the first woman president elected in Mexico. Harris would be the first woman president elected in the U.S. And I think there'd be a lot of eyes on that dynamic. Another issue that'll certainly be a top priority early in her term is Mexico's economy. How's Shinebaum thinking about that? Shinebaum is inheriting a massive budget deficit, and that's going to make it hard press to continue with some of the social spending plans that she wants to carry over

from Lopez Obrador's mandate, as well as some new programs that she wants to implement. She has also pledged to increase renewable energy, but she's going to be up against an indebted state energy company Pemex and managing that. It's a major. major income maker in Mexico, but also has its fair share of problems. And again, the currency, the Mexican peso, has lost at least 17 percent since the Mexican elections up and down, fluctuating due to market volatility over some of the concerns about the judicial reform. So she's going to be up against these challenges as well as increasing investment and boosting confidence to increase international investment in Mexico, raise near-shoring opportunities for international.

companies and there's a serious resource problem, lack of water in Mexico, that she's going to have to be addressing in order to boost some of these issues that will help make international investments flow and improve the economy at the same time. I think the big question for Shyam is going to be around taxes. As I mentioned, Amlo was able to really grow the welfare programs that has and also raised the minimum wage without raising taxes and basically by taking away from certain parts of the states and giving that money to the programs that he thought were more important. And also by going after big companies, basically that he thought hadn't paid enough tax and effectively getting them to cough up kind of tax that his tax agency believed they owed

from past years. I think there's a lot of questions for Shinebaum as to whether she can do the same trick. I think that it's going to be more difficult. There isn't as many places that are within the state where money can be taken from. It's going to be harder to go after those big companies with those tax bills. And as a result, I think a lot of economists think that she's going to have to to raise taxes. And that will be quite a controversial move and a lot of questions as to how exactly she'll do that. You mentioned efforts at attracting new industry. What's Mexico's relationship with China? We've been seeing an increase in some Chinese companies taking hold in Mexico or looking at Mexico as a possible market expansion opportunity. For example, we've seen some Chinese companies with interest in building a plant for electric vehicles in Mexico.

BYD is one of those. They plan to announce the location for it by the end of the year. This has definitely caused concern with allies in the United States. It's just a little bit too close for home with Chinese electric vehicles just south of the board. border, which could potentially at some point infiltrate the U.S. market. So although Mexico's relationship with China isn't incredibly close the way it might be with some South American countries, Argentina, for example, there is a growing, a growing relationship there. And I think particularly with Chinese companies, you might see an expansion of that. I think that like Lopez Obrador,

Scheinbaum will probably take a more neutral position with China and not necessarily be heeding to the orders of the United States to distance them the way that they would like. Stephen, Cassandra, thanks so much. Thank you. Bye-bye. Thanks for having us. A huge thank you to Cassandra Gerson and Stephen Eisenhammer for their political coverage in Mexico.

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