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| FRIDAY, NOVEMBER 1, 2013

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INTERNATIONAL NEW YORK TIMES

Mexicos theology of oil

Enrique Krauze
CONTRIBUTING WRITER

MARK THOMPSON, Chief Executive Officer, The New York Times Company STEPHEN DUNBAR-JOHNSON, Prsident et Directeur de la Publication

ENDLESS WAR, ENDLESS SUFFERING

The innocent victims of Syrias civil war desperately need more aid, food and medicine.
Add a potential polio epidemic to the threats that innocent civilians now face because of Syrias civil war. It is part of what American officials say may be the worst humanitarian disaster since the 1994 Rwandan genocide that killed an estimated 800,000 people. But while the tragedy is unfolding in full view, many countries, including Russia and China, have given hardly anything to the United Nations campaign to meet the Syrians basic needs. Civilians have paid a terrible price ever since President Bashar al-Assad of Syria used force to crush peaceful protests that began in 2011, touching off a full-scale civil war. Officials now put the death toll, including combatants, at 115,000. Of the Syrians who have survived the war so far, some five million are virtual refugees in their own country trapped in neighborhoods isolated by military blockades, or uprooted from their homes and living in vacant buildings, schools, mosques, parks and crowded homes of relatives. Most are desperately short of food and medicine, a deprivation likely to worsen as winter sets in. Meanwhile, another two million Syrians have fled to Turkey, Jordan, Lebanon, Iraq and Egypt, meaning that seven million people, or about one-third of Syrias population, have seen their lives upended by the war. Now comes another trial: the countrys first outbreak of polio in 14 years. United Nations officials have begun to vaccinate 2.5 million children in Syria and more than eight million others in the region after discovering that 10 children in the eastern city of Deir al-Zour have contracted polio. A 25-year campaign by the World Health Organization had largely eradicated what had been a global scourge, narrowing the afflicted states to Nigeria, Pakistan and Afghanistan. Public health experts suspect that jihadis who entered Syria to join the fight against Mr. Assad may have been the carriers. The United Nations has asked its members for $1.5 billion to provide food, schooling and medicine to vulnerable Syrians. That is short of the need, yet the response has been disgraceful. Only 61 percent of the money earmarked for refugees outside of Syria has been collected, while 36 percent of the aid for Syrians inside the country has been collected, according to United Nations figures. China, the worlds second-biggest economy after the United States, has donated a miserable $1 million, while Russia, awash in oil and gas profits, has given $10.3 million. The United States, the largest contributor, has donated more than $1 billion, but it can still do better. The best way to help the Syrians is to end the war. The next best thing is to mitigate the suffering by contributing generously and by pressuring both sides in the conflict to allow aid workers to deliver essential supplies.

MEXICO CITY In almost every country, the availability and exploitation of oil are essentially economic issues every country, that is, except Mexico, where it is a matter of secular theology. For many Mexicans, the question of whether to open the national oil industry to private investment is much more than a practical decision: It is an existential dilemma, as if permitting foreign investment were to bargain away the countrys soul. Over the next few weeks, the Mexican Congress is likely to become a kind of theological council to discuss the socalled Energy Reform proposal put forward by President Enrique Pea Nieto. The measure would modify Articles 27 and 28 of the Constitution and allow contracts between the Mexican government and private companies to share profits from the extraction of oil and gas throughout the country as well as deep-water sites in the Gulf of Mexico. It would also open the door to free competition along the whole chain of the industry: refining, transport, storage, distribution and basic petrochemicals. The historical significance of this proposal cannot be understated. In 1938, the Mexican oil industry was nationalized, and in 1960, a constitutional

change assigned full control of the industry to Pemex, a state monopoly. The Energy Reform will require a two-thirds majority that can be achieved through the representatives of the PRI (the party that ruled Mexico from 1929 to 2000 and was voted back into power in 2012), the PAN (a center-right party, which would prefer even greater liberalization of the industry) and a few small parties. Representatives of the PRD (a party of the moderate left) will likely vote against the reform. The main opposition will not emerge from the chambers of Congress, but rather from the streets, where protests promise to become massive and angry. The opposition has a charismatic leader: Andrs Manuel Lpez Obrador. Defeated in the last two presidential elections, he is positioning himself for a third run, in 2018. There can be no stronger platform than adamant resistance to a reform that he and millions of his followers regard as a betrayal of the nation. In a recent speech, he compared the possible passage of the Energy Reform to the loss of Texas in 1836 and Pea Nieto to Santa Anna, the general who lost the Mexican War and is remembered in history books as a traitor. But the economic arguments for such a rejection are weak. The opposition says that Pemex can, by itself, successfully explore the Gulf of Mexico and exploit shale deposits if the government grants it the financial autonomy to in-

crease its investment. But the government commitment to oil exploration has risen sixfold in the last 10 years (to $25 billion, from $4 billion), without major results. The United States may be on the path to energy self-sufficiency, thanks to oil wells drilled each year in the Gulf (about 150) and about 10,000 new wells a year for shale oil and gas. Pemex drills A proposal only about five oil to open the wells per year in deep state-run oil water and plans only industry to 140 wells per year for competition shale gas. And Mextroubles many ico has to import large quantities of Mexicans gas and gasoline. but its the How, then, can the right move. fierce opposition to contracts with private companies which would halt the decline in production, modernize the industry, create jobs, substantially increase oil profits for the Mexican state and foster much needed economic growth be explained? Why cant Mexico, like Brazil or Norway, develop its publicly owned oil company into an enterprise that can successfully benefit from association or competition with private companies? The first reason is the controversial record of privatization in Mexico. When Carlos Salinas de Gortari, president from 1988 to 1994, transferred ownership of banks, television and telephone

companies from the state to private hands, the general view was that he had favored his friends, with lucrative results for the new owners but not for the consumer. Yet the Energy Reform is not an act of privatization. Contrary to the oppositions rhetoric, no property will be transferred to the companies involved. A second explanation deeper and more complex is the weight of nationalism. The Constitution of 1917, the product of a social revolution that began in 1910, was a foundational document for the new Mexico. Its most emblematic article was the 27th, which assigned ownership of aboveground and underground resources, formerly the property of the Spanish crown, to the nation. For two decades, British, Dutch and American oil companies refused to accept Article 27 and operated as extraterritorial enclaves, manipulating their books and evading taxes. Then, on March 18, 1938, after a labor dispute, President Lzaro Crdenas nationalized the industry. The popular reaction was spontaneous. To pay the debts incurred by the expropriation of the foreign companies, rich women contributed their earrings and poor people their chickens. From then on, textbooks, monuments and annual ceremonies celebrate Crdenass actions as a restoration of national honor. In a number of ways, it was. And so, understandably, to many Mexicans including Cuauhtmoc Crdenas, Lzaros son and the respected leader of the moderate left todays Energy Reform appears to be a sin against history. But a third issue, little discussed by the opposition, seems the most compelling: the fear that increased oil revenue will simply raise the level of corruption to the point reached during Mexicos last oil boom, which began in the late 1970s and led to a traumatic experience for the Mexican people. Mishandling the new abundance and elevated world prices, the PRI government created a vast bureaucracy that embarked on wasteful projects, contracted gigantic international debts and eventually bankrupted the country, leading to the disastrous devaluation of the peso in 1982. Given the past performance of Mexican governments, it is legitimate to be skeptical. The opposition could do a great deal of good by focusing on practical steps to avoid another economic fiasco: maintaining tight vigilance over contracts, ensuring the productivity and transparence of new investments, creating a fund for future development (as in Norway), monitoring potential ecological damage, restructuring and modernizing Pemex, and, most important, assuring that profits are not used to expand bureaucracy but are delivered to the Mexican people. With the opposition still completely opposed to the Energy Reform, the only way the government can win this battle is not through a theological debate about the Mexican soul, but by convincing ordinary Mexicans that the reform can deliver tangible results, that this time it will be different and the newly generated wealth will reach the hands of its presumed owners: the Mexican people, especially the tens of millions among them most in need.
is a historian, the director of the literary magazine Letras Libres and the author of Redeemers: Ideas and Power in Latin America. This article was translated by Hank Heifetz from the Spanish.
ENRIQUE KRAUZE

EASING INDIA-CHINA TENSIONS

The border cooperation accord is a modest step toward averting more dangerous confrontations.
The border between India and China converges along a largely uninhabited region in the high reaches of the Himalayas. Where exactly the border lies is a matter of bitter disagreement. In 1962, the dispute led to outright war, with China seizing territory it claimed to rightfully own. Sparring has continued in the decades since. In April, Chinese troops set up camp in territory occupied and claimed by India. Though the incident was peacefully resolved and the Chinese troops retreated, the incursion was a reminder that the issue remains a potential spark for more serious confrontations. Last week, Prime Minister Manmohan Singh of India and the Chinese premier, Li Keqiang, signed a Border Defense Cooperation Agreement. It would prevent minor incidents from escalating into more dangerous confrontations and also provides the potential for crossborder trade that could further reduce tensions. The agreement does not, however, remove the major source of conflict: Chinas claims to territory occupied and claimed by India. The agreement takes some immediate practical steps to ease tensions, including hot-line communications between senior officers from the two sides and an end to border patrols tailing each other. In recent years, both India and China have moved to build roads, railroads and airfields along the border. Clearly, one goal of these transportation networks is to facilitate the rapid movement of troops and artillery to the border zone. The roads can also increase crossborder trade. Trade between India and China grew to $66 billion in 2012, but Indias slowing economy has saddled it with a trade deficit with China of $30 billion. Increased exports to China could help Indias economy get back on track and lift more people out of poverty. China would also benefit from investment in India and greater access to Indias consumer market. Meanwhile, both China and India continue to enlarge their military capacities. India has announced that a 40,000-man Mountain Strike Corps will be installed along the border. And China, as India surely knows, is not about to abandon its claim to territory that it views as part of a reunited One China. Still, the agreement gives both sides an incentive to review their now very different maps of the region and settle on a permanent border. Until that happens, the possibility of serious conflict remains very real.

PETE GAMLEN

Young, restless and Indian

Siddharth Dhanvant Shanghvi
MUMBAI, INDIA Back in 2003, when I lived in a small, liberal California town near Berkeley, the prospect of George W. Bushs re-election filled my neighbors and me with palpable dread. At our annual block party some of us facetiously repeated things hed said, Bushisms like I know the human being and fish can coexist peacefully. What we really meant was that we could not coexist with Bush, peacefully or otherwise. By then Id spent a few years in America, and the possibility of returning home, to India, flooded me with an exit-clause relief my American neighbors at the block party might only dream about. Soon, my sister also insisted that I return; our parents, she said, were not well. Id published a vaguely successful first novel, and I could work on the second in the country where Id grown up. So I returned to Mumbai. Things had certainly changed back home, but not always for the better. For one, my sister had neglected to tell me that where there was once a seasonal pond, at the back of our family house, there now stood a giant parking lot. All the same, I warmed to glimmers of our public progress. At great expense, a massive bridge

now commonly known as the Sea Link was being constructed to join the midtown enclave of Bandra to the southern tip of the city. This was not a one-off. Across the country, roads were being built. Villages were getting access to water and power. We Indians were now one of the largest consumers of cellphones in the world. And the Right to Information Act was being used to make government officials accountable for their actions (and inactions). In spite of all the rumors of shoddy infrastructure and insidious corruption, with my boots on the ground, it appeared Im told Im part of Indias to me a healthy, hopeful time to repowerful rulturn to India. ing class that I was in my 20s at says in public, the time, and I thought a lot about Actually, get what it meant to be a four bottles young person in Inof that red. dia. I was a part of our largest demographic (over half of the nation is under age 25). This fact was billed as something attractive by the liberal press. Although later I came to think more deeply about the other things we also associate with youth bad credit, for instance, and binge drinking for the moment, inexperience and healthy knees formed an exciting counterpoint to the traditional Indian veneration of old age and senility (our incumbent prime minister, Manmohan Singh, is now past 80). Youth, the

new malls told me, was king. To fit in, I even bought a pair of jogging track pants. I almost bought a hoodie, too. Im in my 30s now still young, yet old enough to be fabulously bitter. When I go out now, the talk at the bars is about which Maldivian island is best for diving. People in Mumbai say they want to get out of the slum capital of the universe. They want to go deep-sea diving instead. Im told Im part of Indias privileged elite, the powerful, unconscionable ruling class that says in public, Actually, get four bottles of that red. Its a little like being stuck in a Bret Easton Ellis novel, where the protagonist orders chai after a night spent on Special K. With this lot of new friends I sometimes cruise down the now-completed Sea Link, all the while listening to the Icelandic rock band Sigur Ros, which my friends claim speaks to their pain. Though rarely used, the full name of the bridge is the Rajiv Gandhi Sea Link, so called for the former prime minister, who was assassinated in 1991. A few weeks ago, Rajiv Gandhis son, Rahul, publicly criticized legislation supported by his party, the Indian National Congress, that would allow legislators convicted of crimes to seek public office. Regretting his public outburst, the former hope for change in India said that his mother, Sonia, had pointed out that his choice of words to denounce the ordinance complete nonsense was strong. But I am young, he countered (he is already in his 40s, al-

though in Indian politics, 81 is when you get your driving permit). Id have liked to ask Mr. Gandhi what that means: I am young. I myself no longer have a clear idea. Perhaps it means being so disillusioned with life in modern India that, quite frankly, never mind the Congresss election promise of eradicating poverty, Id like him to buy me a Scotch and soda now. It may mean being so angry at the larger failure of the system, the physical failure the potholed roads, the power shutdowns that ones anger can become utterly mute from its weight. And it may also mean being so bored by the failure of cultural originality the absence of anything beyond Bollywood, and the fact that most of our contemporary art is shamelessly derivative of Western work that the inertia of imagination can knock you out cold. If Mr. Gandhi believes youth is given to impetuosity, Id say to him that it is also marked by restlessness: Young people drift. Sometimes the forces in a country, be it corruption in the political classes or bad grammar in the national press, provoke a revolution. And sometimes, when it appears the revolution will exhaust itself before ever beginning, the computer servers in India for Getmeoutofhere.com will crash.
SIDDHARTH DHANVANT SHANGHVI is the author of the novels The Lost Flamingoes of Bombay and The Last Song of Dusk.

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