At around midday on the last day of July, a tiny man with a shiny head and a small, bristly moustache turned up in Chihuahua in northern Mexico to promote his latest book. The diminutive figure was that of Carlos Salinas, the country’s former president and probably Mexico’s most dynamic – and most despised – leader since the 1910 revolution that saw out a dictatorship lasting 30-odd years. Wearing a tight-fitting black suit, a white shirt and a lime-green tie, Salinas ranted on about The Lost Decade, the title of his book and a period he defines as 1995 to 2006, when, he says, neo-liberal and populist policies across government forced Mexico off the development highway – socially, politically and, in particular, economically.
Salinas modernised Mexico beyond recognition during his 1988-1994 presidency – only to leave office a few days before the Tequila crisis, a financial storm that ended with a huge devaluation of the currency and a US-backed $50bn bail-out. Understandably, perhaps, in Chihuahua he did not dwell on his own role in bringing about that crisis. Instead, standing before a crowd that included many influential politicians from the local chapter of his beloved Institutional Revolutionary Party, or PRI, and packed into what used to be a post office, he used the occasion to talk about current political events.
He talked, for example, on the highly sensitive issue of energy reform, commending efforts by congress to reverse rapidly falling oil production, while reinforcing Mexico’s obsessive desire to maintain sovereign control over its oil reserves – an idea that Salinas supports blindly. And he talked about the president, Felipe Calderón, praising his leadership and arguing that Mexico finally had an administration that had seized the torch of reform once again.
This might sound like the everyday pontificating of an elder statesman, but it’s not the sort of thing retired Mexican political leaders do. Since 1929, when the PRI took office, presidents lorded it over Mexico as if the entire country were their private manor, and congress followed presidential orders without a quibble. Once out of office, however, these former presidents repaid that loyalty and obedience by disappearing almost without trace and, at the same time, allowing their successors to blame them for all the country’s ills. Yet now Salinas, with a speaking event that felt somehow more significant than a book launch, seemed to be breaking with tradition. He was telling his audience, and subtly sending a message to the nation’s 106 million inhabitants, that their former president was not only ready to step back into the public eye after more than a decade of semi-, self-imposed exile in Europe. Politically, he was also looking for a piece of the action.
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In some ways, the timing is perfect for a Salinas comeback. In 2005, Mexican authorities exonerated the former president’s brother Raúl of a murder for which he’d been imprisoned for a decade. And this year, a Swiss judge dropped a 10-year case against Raúl for money-laundering – leaving him facing just a handful of relatively minor charges. Suddenly, Salinas’s road back to Mexico looks considerably less complicated.
Family trouble aside, staging a comeback any earlier would probably have been impossible. First Ernesto Zedillo and then Vicente Fox, the two presidents who followed Salinas’s administration, harboured an acute dislike of their predecessor, and it was clear that neither of their governments would welcome him back on Mexican soil. Zedillo, for one, had adopted the traditional strategy of incoming Mexican presidents by pursuing Salinas and his family, and the Tequila crisis had given him even more reason to do so. Today, however, those figures are long gone from Mexico’s political landscape. For years, Zedillo has been living in the US where he teaches at Yale. Fox, meanwhile, is busy with the construction of a US-style presidential library as well as writing his memoirs from his ranch in the Mexican state of Guanajuato.
But the biggest motive behind Salinas’s return is probably that his party, the PRI, is back on the rise. After a decade of decline and a disastrous showing in the 2006 presidential election, it notched up several impressive election victories last year and recorded two more in the past two months – first in the southern state of Guerrero, where it delivered a huge blow to the leftwing Democratic Revolution Party (PRD), the local incumbent; and then in the state of Coahuila, which shares a border with Texas, where it won more than 50 per cent of the vote in elections to appoint a new state legislature.
Most political analysts believe that when Mexicans go to the polls next July for mid-term elections, the PRI will regain its historical position as the country’s dominant party. If that happens, it could easily find itself standing at the open door of the presidency for the 2012 election – an unimaginable thought just a few years ago.
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Salinas was born and raised in a middle-class neighbourhood of Mexico City. His father, Raúl Salinas, was a member of the PRI and transformed his family’s aspirations – and living standards – by serving for several years as Mexico’s secretary of industry. Carlos attended Mexico City’s UNAM university, studying economics, and went on to Harvard after graduation in 1970. At the US university, he accumulated masters degrees in public policy and political economy and a doctorate in political economy and government by 1978.
The experience of studying and living abroad gave Salinas a taste of the outside world at a time when Mexico was looking inward. In particular, it allowed him to see the limits of his homeland’s state-dominated and closed economy. He moved back to Mexico after obtaining his doctorate, and immediately took up a place among the ranks of the PRI while teaching at several universities. His big break came in 1982, when Miguel de la Madrid, a former teacher at UNAM, was chosen as the party’s presidential candidate. When de la Madrid won – unsurprisingly – he hired Salinas, then just 34, to handle the expenditure side of the country’s budget.
A colleague from the time remembers how Salinas’s charisma transformed the large reception room next to his office into something resembling a train station at rush hour. “There were always lines of people,” he said. “Then, as soon as Salinas moved on, it went back to being the same dull old place it had always been.”
A couple of decades on, it is difficult to avoid the impression that Salinas desperately wants to recapture that sort of atmosphere, and that he believes that he has sufficient youth – he’s 60 years old – to do it all over again. This, after all, is a man whose energy and ambition got him to the presidency at the age of 40 and quickly earned him the nickname of “the atomic ant”. The moniker may undersell him: for all his fierce energy and ambition, he’s also charming, apparently easy-going – and highly manipulative. When in office, he would go to extraordinary lengths to control his environment. Journalists interviewing him at Los Pinos, the presidential residence, were wired up with microphones, every word recorded. His obsession with the foreign press would lead him to summon correspondents at more or less any time of day or night to talk about articles they had written. He would sit them down, call them by their first names and, in a gentle but persuasive tone – he never raised his voice and rarely appeared to get angry – tell them how they had got the story wrong or how they should consider looking at the issue from a different perspective.
Mario Vargas Llosa, the Peruvian novelist and former politician, once called the PRI’s hegemonic rule over Mexico “the perfect dictatorship”. Indeed, many of the presidents during that 71-year period of unbroken rule paid homage to democracy and reform in name only, while in practice they did everything possible to maintain the status quo. Salinas’s extraordinary intelligence may have been the reason he tried to break that mould. One journalist who knew him well said that he left a lot of people feeling like the village idiot because his brain was clearly working so much faster than theirs. What most set him apart, however, was his vision. People who worked in Salinas’s government in the 1980s recall those days as dazzling and exciting times. “Salinas created this buzz,” a former high-ranking member of his government told me. “There were always people around, things happened quickly and we felt that we were on the brink of modernity.”
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In the dying days of August, over lunch in the El Lago restaurant, which sits on the edge of a lake in Mexico City’s Chapultepec Park, a bright-eyed and jovial Salinas played down his intentions and influence. In his unmistakable voice, which sounds as if someone has filtered out most of the bass frequencies, he talks enthusiastically about the new generation of PRI leaders gaining power within the party, particularly a handful of state governors such as Enrique Peña Nieto, who heads the local government in the State of Mexico, which surrounds the capital. In the 42-year-old, good-looking Peña Nieto, in particular, Salinas sees the same vitality that he possessed when forging his way to the presidency two decades ago. Yet Salinas claims that these young politicians are people he sees only “at social events, weddings, we have had enjoyable encounters”.
Surely he is closer to the new generation of PRI leaders than simply clinking glasses with them at cocktail parties? “About as close as we are to that boat over there,” he replies, raising a hand and pointing to a rowing boat on the lake about 50 yards away. “We look close to it, don’t we? But there is a pane of glass between us and there is quite a bit of water, too ... I share my ideas, I make observations but I don’t give advice.”
For now, that may be true. But there is little doubt – active PRI members and people still closely connected with the party confirm it – that he would like his role to grow and develop into that of a visible elder statesman, the voice of experience and wisdom that the younger generation of PRI leaders could consult on matters of strategic and ideological importance.
Salinas has trimmed his moustache and shaved his head – quite a change from the bald crown with a horseshoe-shaped ring of hair that became his trademark. He also looks fit. As he tucks into a plate of red snapper, he explains that he drinks little, and when he does he sticks to red wine – preferably Bordeaux in half bottles. “When you open a full bottle there is always a temptation to drink it all.” He runs four or five times a week, for at least 30 minutes a session.
After losing office in 1994, Salinas remained in the capital for a few weeks before beginning a period of self-imposed exile. At first, he and his family moved briefly to Cuba, before eventually settling in Dublin. Sporadic newspaper reports from that period paint a picture of only relative happiness: the family rented an elegant house in the Ballsbridge district of the Irish capital, but they talked a lot about the cold. Salinas began to wear a tweed cap.
Since then, Salinas has divorced his first wife and married Ana Paula Gerard, an economist. Today, they live in London with their three children, including their two-year-old son (Salinas has three children from his previous marriage). Over lunch, he asks me if I want to see the key to his office. Before I have a chance to decide, he whips out his British Library card. “I go from nine until two because that is when Mexico is sleeping,” he explains. “That way, I get four or five hours of pure concentration.”
It is clear that Salinas wants to go down in the history books – and, just as important, in popular memory – as the man who transformed Mexico from an inward-looking, undemocratic country into an open and dynamic democracy, and home to an increasing chunk of north America’s manufacturing platform. Whether he manages a comeback or not, those claims will not go uncontested. Salinas filled most of the strictly political posts in his cabinet with members of the PRI’s oldest guard and meddled obsessively with state politics. The little political reform that did take place during his administration appears to have been the result of his pragmatic acceptance that Mexico would at least have to look more democratic if it was to open up to the rest of the world.
Moreover, Salinas’s election victory was the most controversial in Mexico’s modern history, and huge swathes of the country still believe that Cuauhtémoc Cárdenas, his leftwing rival, was the true winner. The fact that the official count was temporarily interrupted on the night of the election did not help the PRI’s case.
On the other hand, Salinas was indeed something of a visionary when it came to trade and economic policy. He filled the remaining half of his cabinet with bright, young Mexican technocrats educated at the finest universities in the US. By 1994, and mainly via their interpretation of the liberal policy guidelines that were all the rage among Washington-based policy wonks and that came to be known as the “Washington Consensus”, Salinas and his ministers had almost halved the country’s external debt, balanced the budget and brought inflation, which was at dizzying heights just a year before he took office, down to levels more associated with the highly industrialised world.
One of the cornerstones of Salinas’s vision was smaller government. “A bigger state is not always a more effective state,” he told the Mexican people during his first state of the union address, in 1989. For him, that meant a wave of privatisations involving the sale of more than 1,000 state-owned businesses that stretched across Mexico’s economy from mining and telecommunications companies to hotels and fishing enterprises. Even state-run funeral parlours were game.
Most famously, and arguably most important, Salinas was responsible for dreaming up and implementing the North American Free Trade Agreement or Nafta, the trade accord that binds Mexico, the US and Canada. While it’s now the bugbear of populist politicians in the US, and while it proved detrimental to several areas of Mexico’s economy, particularly agriculture, it also modernised northern Mexico, spawned a wave of new industries and caused trade with the US to boom. Mexico today is a transformed nation because of it.
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The tragedy for Salinas is that few people in Mexico care – or are able – to remember his considerable achievements because they are obscured by the memories of Raúl’s arrest, and the fact that many of his friends were the ones who ended up being the beneficiaries of the huge sale of state assets. Ask Mexicans to sum up with one word the Salinas years and many will say: corruption. The moderniser’s administration, in a Shakespearean twist, fell prey to the vices of the past.
And yet the most painful memories centre around the Tequila crisis. The sudden and dramatic devaluation of the peso, as well as a supercharged increase in interest rates, sent the economy into a tailspin and led to millions of Mexicans losing their cars, their businesses and even their homes. To this day, Salinas is unwilling to accept any blame for the crisis. In The Lost Decade, he spends hundreds of pages explaining that the government of Ernesto Zedillo, which followed his, was not only the culprit but also that it launched a media campaign to make him the scapegoat. A couple of his arguments are persuasive. Others are cheap tricks, such as referring to the 1994 crisis as “the 1995 crisis”.
Moreover, he argues that Zedillo and Fox did unparalleled harm to Mexico – the first by causing the crisis, and the second by failing to push through important structural reforms that would have made the country more competitive. “In 1994, we were growing at almost 5 per cent, in the following six years we grew at an average of 3.2 per cent and, in the six years after that, 2.3 per cent,” he tells me the lunch. “What happened?” Thousands of pages have been written about the crisis, and it seems pretty clear that Salinas shared much – if not most – of the blame, not least because of the inflexible exchange rate mechanism, overvalued peso and, in particular, the dangerously high current account deficit his government ran, which was covered only by short-term, speculative capital. What has tended to stick in Mexicans’ minds is that for all his achievements, Salinas’s term ended with one of the biggest financial crises in the country’s history while that of Zedillo ended with the world’s leading rating agencies awarding Mexico investment-grade status.
That abiding perception is why the PRI leaders of today may speak to him on the phone or even hold the occasional meeting behind closed doors, but they keep him at arm’s length when it comes to public engagements. Unfortunately for Salinas, it is also why he will almost certainly never be fully welcome in Mexico again, no matter how many books he writes or how much he argues that he was set up as the fall guy. As one former high-ranking figure in his government told me recently: “Salinas wants many things, but most of all he wants to be able to walk down the street in Mexico City and have people coming up to him to shake his hand. That will never happen.”
Adam Thomson is the FT’s Mexico City correspondent
