Widespread backlash to fuel price hikes may spell doom for the current Mexican government

Mexico gasolinazo gas fuel price increase energy reform protest demonstration(AP Photo/Rebecca Blackwell)A protester gives a thumbs up to honking drivers as he and others angry over gas price hikes block a gas station on Calzada de Tlalpan in Mexico City, January 3, 2017.

Mexicans have mounted three straight days of protests since a widely scorned gas price increase went into effect on January 1.

The country’s finance ministry announced on December 27 that gas prices around the country would go up by between 14% and 20% on January 1.

Those prices will undergo bi-weekly adjustments in February, and starting at the end of March the country will be divided into zones where prices will fluctuate daily based on demand.

All this is part of a price-liberalization scheme that was part of the landmark energy reform passed in 2013, which President Enrique Peña Nieto told his countrymen would “generate more energy, more cheaply for all Mexicans.

Immediately after that announcement, leaders of the opposition leftist Party of the Democratic Revolution and conservative National Action Party criticised the move and said the governing Institutional Revolutionary Party, of which Peña Nieto is a member, would be to blame for the resultant social instability and inflation.

A PRD leader called for Mexicans to take to the streets in a “peaceful revolution” against “a lying and treacherous government.”

In the days prior to the price hike’s implementation, Mexicans in 10 states mounted demonstrations, and social-media channels echoed with calls for other protests to take place starting on January 1.

Mexico gas price hike shortage protest traffic highwayTiempo/FacebookTraffic on a highway in Chihuahua, in northern Mexico, is stalled because of a blockade mounted in protest of gas price hikes, January 3, 2017.

Gas stations in several parts of the country were swarmed by drivers looking to stock up on fuel in order to avoid paying higher prices for at least the first few days of the new year.

In the days since January 1, public anger at the price increase — as well as at price increases for basic goods and and other energy services that seem likely to come — doesn’t appear to have slacked.

As of Tuesday, transportation workers, social and workers’ groups, members of opposition political parties, and citizens have mounted protests throughout the country, reportedly in 28 of Mexico’s 32 states.

Mexico gas price hike energy reform protest(AP Photo/Rebecca Blackwell)A woman with a sign of a person held up with a gas tank pump, with the Spanish message: ‘Oil country, and the people without money,’ protests fuel price hikes by blocking access to a gas station on Calzada de Tlalpan, in Mexico City, January 3, 2017.

On Monday, protests were reported in Mexico City, where demonstrators gathered outside gas stations and hundreds marched through the streets.

In Morelos state, which is southwest of Mexico City, demonstrators held a sit-in at a Pemex distribution and storage facility.

Hundreds of demonstrators also blocked roads connecting Mexico City to neighbourhoods and cities in Mexico state, which wraps around the Mexican capital like a horseshoe.

The highway connecting Mexico City with Toluca, the capital of Mexico state, was blocked by protestors with signs reading, “No more gasolinazos.”

Roadblocks in Hidalgo marked the fourth straight day of protests against the fuel price increase in that state.

In Oaxaca, in Mexico’s far south, members of the Workers’ Party and the leftist PDR mounted separate protests

In Puebla — where gas shortages have been widespread and 120 of the over 500 gas stations are closed — social and workers’ groups were joined in their protests by Uber drivers.

Members of the National Regeneration Movement, or Morena — a left-wing party started and led by two-time presidential candidate and 2018 presidential contender Andres Manuel Lopez Obradorjoined with taxi drivers and transportation union members to protest the price hikes in Veracruz.

Starting early Monday morning in Chihuahua, which borders the US, protestors blocked a railway and pipes at a Pemex station.

Protests also lashed Mexico’s southwest.

On January 2 in the Jalisco state capital, Guadalajara, masked protestors who had closed roads in the central part of the city clashed with riot police, throwing stones and bottles. The riot police responded by firing tear gas that sent dozens, including some minors, scattering.

In Guerrero, taxi drivers and other public-transport workers forced the closure of gas stations. In Acapulco, Guerrero’s main tourist destination and a focal point for drug-related violence, members and supports of Morena took to the waters around a naval installation to protest the fuel price hikes.

In Michoacan, transport workers, students, and residents led numerous protests and blockades. Of the almost 100 gas stations in the city of Morelia, where pre-Christmas gas shortages were widespread, about 65 were reportedly operating.

In a clear sign of public solidarity against the price hike, some fans of the rival Tigres UANL and Rayados de Monterrey soccer clubs posted an event on Facebook titled “Tigres and Rayados vs the government.”

“This event is to protest agains the government IN A PEACEFUL MANNER for the increases in gasoline, transport, and hence for basic goods,” the group’s organisers wrote on their page.

Others have mounted efforts to challenge the hikes legally, with a group in Mexico City appealing to the country’s Supreme Court to intervene and halt the increases, arguing that the higher prices would constitute a violation of their human rights.

Such a claim isn’t outlandish in the context of the Mexico’s relationship with the its oil.

In 1938, then-President Lazaro Cardenas of the National Revolutionary Party (a predecessor to Peña Nieto’s PRI) nationalized the country’s oil industry, a move that pushed out foreign companies and has been heralded by Mexicans since.

Mexicans have long had their gas subsidized by the government, and many in the country now associate that nationalization not only with Mexican patrimony but with cheap prices at the pump.

“There’s a sense that Mexico is rich in petroleum and a sense that all the citizens are entitled to some sort of shareholder benefit,” George Baker, publisher of Mexico-focused energy website energia.com, told The Washington Post.

Mexico gas station shortages Pemex oil industry gasolinazo(AP Photo/Marco Ugarte)A taxi driver fills containers in his trunk with gasoline after waiting for hours at a fuel station in Valle de Bravo, Mexico, Friday, December 30, 2016.

In the face of rippling backlash, the PRI leadership has tried to justify the price increase. Enrique Ochoa Reza, the party’s national director, said on January 1 that continuing the subsidies would require raising taxes or making cuts to social programs.

“It has eliminated the artificial price of fuels, and, in consequence, we are able to save programs for social security programs, for attention to poverty, for construction of infrastructure that our country so needs, that were at risk to keep the artificial price of fuels,” he said, according to Mexican newspaper Reforma.

Some analysts have acknowledged that increased fuel prices could, in the long-term, improve the allocation of energy resources (and others have argued that the real benefit of subsidies accrues to the most well-off Mexicans), but others have criticised the government’s spending choices that have led to this point.

“We have found that the federal executive spends more than what the [legislature] approves,” Edna Jaime, director of public-policy think tank México Evalúa told El País.

In 2015, the federal government spent about $380,000 on publicity and communication, well over the roughly $142,000 approved for that part of the budget.

Peña Nieto went on a nine-day vacation on December 26, during which he planned to play golf on New Year’s Eve.

The Mexican president has tweeted twice since January 1 — one of which was a New Year’s greeting.

In Peña Nieto’s apparent absence, the political opposition has been rallying support in the face of government’s latest controversial policy.

In addition to criticism of the gasolinazo from the PAN and PRD, Lopez Obrador, the leader of the Morena party, has been capitalising the economic and political doldrums afflicting Mexico in recent months.

He has promised to attack corruption, create jobs, support the poor and elderly, and bring “real change” to Mexico. He has put himself in opposition to the numerous structural reforms pursued by Peña Nieto, causing trepidation among the country’s political and business establishment.

But his stature has been bolstered by both the PRI’s missteps and his own fervent pledge to combat corruption. While some see him as the default option for the presidency in 2018, there is quite a way to go before that election and its still possible AMLO, as he’s known, could squander his popularity.

Whatever changes AMLO’s public perception sees in the next year and half, however, it seems increasingly unlikely that Peña Nieto will recover from the scandals and shortcomings that have blighted his time in office.

“[Peña Nieto] said that with the energy reform there would be no more gasolinazos and that is a lie, but we are going to remember it at the polls,” Soledad Rincón, who took part in the blockade of a gas station on a major Mexico City thoroughfare, told El País.

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