American Think Tanks Are Fueling the Mexican Right
By Kurt Hackbarth
In Mexico, Andrés Manuel López Obrador faces an uphill battle in getting his energy reforms through Congress. American interests, vehemently opposed to the idea of a public energy sector in Mexico, stand in the way.
After more than six months of debate, dispute, and a series of high-profile public forums, Andrés Manuel López Obrador’s constitutional energy reform is heading for a mid-April showdown in the Mexican Congress.
One of three major reforms the president hopes to pass in the second half of his administration, the reforma eléctrica, as it is known, seeks to strengthen the role of the public energy sector, curb the abuses of companies that have gamed the system to their advantage, and, crucially, nationalize the nation’s lithium stores together with other strategic minerals. Although it stops short of taking electricity production fully into state control, it remains a crucial step on Mexico’s path toward regaining energy sovereignty.
And right on cue, foreign powers with energy interests in Mexico have continued to ratchet up their opposition. Juan Fernández Trigo, the secretary of state for Ibero-America in the government of Pedro Sánchez, warned that Spain will “react very clearly” against the new law.
US ambassador Ken Salazar, who has made railing against the reform practically a full-time job since assuming the post, stated at the end of March that he doesn’t know “where we’re headed” with the measure — as if Mexico’s domestic prerogatives concerned the United States. And in a cake-taking display of paternalism, three days later in a meeting with the president and energy-sector executives, Special Envoy John Kerry proposed that an American task force led by Salazar supervise the development of the energy reform — something López Obrador (AMLO) brushed off at his press conference the following morning.
Not content with this little colonial throwback, the embassy subsequently issued a snippy communiqué highlighting the “significant concerns the United States has raised about changes to Mexico’s energy policy,” capping this off with a very unsubtle threat to weaponize the United States–Mexico–Canada Agreement (USMCA) — the successor to the North American Free Trade Agreement (NAFTA) that came into effect in 2020 — against the reform.
Think Tanks and the Revolving Door
Behind all the diplomatic posturing and histrionic headlines lie an enmeshed series of cross-border interests whose overriding objective is to ensure that Mexico’s abundant energy stores remain open for the taking. And as easily as they cross from one country to another, its members file through the revolving door between the public and private sectors as if each were simply an extension of the other.
After a number of egregiously pro–fossil fuel decisions as secretary of the interior, Ken Salazar went on to work for WilmerHale, a law and lobbying firm with a roster of energy clients including British Petroleum, whose drilling operations Salazar’s Interior Department had exempted from environmental-impact analyses. (For John Kerry’s part, a sizable portion of his vast personal wealth has been made on oil, gas, and other energy-sector holdings.)
On the Mexican side of the ledger, former president Felipe Calderón went on to join the board of directors of Avangrid, a subsidiary of the Spanish energy giant Iberdrola. Calderón’s energy secretary, Georgina Kessel, also went to work for Iberdrola as a top-level advisor. As for Jesús Reyes Heroles, former energy secretary and the head of the state oil company PEMEX in Calderón’s tenure, he instead became a nonresident fellow at the Baker Institute for Public Policy for the United States and Mexico.
The case of the Baker Institute merits special attention, as it is emblematic of how these cross-border interests converge and operate. Founded in 1993 and annexed to Rice University in Houston, “the energy capital of the United States,” the institute is named after former secretary of state James Baker and has, in its own words, “established itself as one of the premier nonpartisan public policy think tanks in the country.” To perform its activities, the institute has at its disposal an $11.4 million annual operating budget, backed by an endowment worth some $160 million — and helped along by several million dollars’ worth of Koch Foundation money.
Another important supporter of the institute is a very well-known name in Mexico: Claudio X. González Laporte. A life member of the institute’s board of advisors, González Laporte, the CEO of Kimberly Clark Mexico, is one of the select names to appear in the top-level “Statesman Circle” of donors. González also happens to be a sworn enemy of AMLO, one of his most vicious antagonists in his first two presidential campaigns, while his son, Claudio X. González Guajardo is the power behind the throne of the opposition coalition Va por México, which, having failed to wrest back control of Congress in 2021, is currently in the process of attempting to stay together to fight the presidential election of 2024.
With these kinds of names in the mix, it’s hardly surprising that Baker’s Center for the United States and Mexico churns out an industrial quantity of right-wing propaganda, especially in energy matters. In a video dating to 2013, when President Enrique Peña Nieto was pushing through his own set of reforms to privatize PEMEX, center fellow Tony Payan repeated verbatim the arguments that were being expounded in the Mexican press at the time: that PEMEX was losing competitiveness due to its technical inability to exploit new energy deposits — assertions subsequently torpedoed by the discovery of a series of oil and gas fields during AMLO’s tenure, one as recently as this past March.
In a video from this year, Payan is still at it, now insisting that taking energy back into public control is a “failed model of the past” designed to kill competition, introduce distortions in the market, and deny consumer choice. For his part, Reyes Heroles echoes his colleague in an event of his own by declaring that AMLO’s reforms will mean “turning back the clock.” In a piece of exceptionally subtle argumentation, fellow Miriam Grunstein compares AMLO’s hydrocarbon law, which cracks down on irregularities in the importation and distribution of gasoline, to nothing less than Orwell’s Nineteen Eighty-Four.
Then there is the center’s intriguing choice of guests. In March of 2019, it played host to Supreme Court justice Eduardo Medina Mora, the former head of the Mexican intelligence agency CISEN, mere months before he was forced to resign from the bench on accusations of money laundering. In February 2020, it gave a platform to the conservative governor of Tamaulipas, Javier García Cabeza de Vaca, playing him up as a “major opposition leader” shortly before he was placed under investigation for fraud, organized crime, and the deviation of millions in state resources.
Not to be deterred, the center has apparently decided to switch horses to the governor of Nuevo León, Samuel García, famous in his brief tenure for checking a baby out of a state orphanage for a weekend and for proposing a troubling new state constitution in which disobeying or disrespecting the governor is a punishable crime.
Think tanks like the Center for the United States and Mexico at the Baker Institute fulfill a very precise function in the political ecosystem of the region. By bringing together like-minded politicians, academics, businesspeople, journalists, lobbyists, and graduate students, they have created a well-financed, tax-deductible space where they can network among themselves and — in this case — with the energy interests clustered around the institute’s Center for Energy Studies. In doing so, they facilitate a convenient two-way communication channel: elite talking points from Mexico can be translated into easily digestible form in English, laundered to give them a nonpartisan, academic stamp, and disseminated through a roster of “expert” talk-show guests, op-ed writers, or standard news stories in media outlets all too willing to reproduce the viewpoints on offer without question.
In the opposite direction, the philosophy and conclusions of the think tanks can be injected into Mexico through friendly domestic media arms and, from there, into the political mainstream. If one ever wondered at the origin of what in Mexico is known as the nado sincronizado, or “synchronized swimming” of attack pieces appearing simultaneously in the national and international press, an institute like Baker would be a good place to start.
Calling Biden’s Bluff
AMLO is clearly wagering that, by leaving up to 46 percent of Mexico’s electricity market in private hands while offering possibilities for investment elsewhere, he will be able to placate the foreign players that have manipulated the privatizations of a decade ago to their very lucrative advantage.
But in the context of a heavily sanctioned Russia, and with the United States casting around for energy sources while attempting to force Latin America to toe its diplomatic line, things are not what they were when the reform was first introduced. And with Uncle Sam’s mafia-like warnings that AMLO’s energy reform will lead to “unending lawsuits,” there are indications that these interests are looking past next week’s congressional vote, should it be successful, to other means to block the reforms: an extension, in effect, of the “lawfare” campaign that has been waged domestically against the president’s agenda for three long years.
This may very well prove to be an empty bluff. AMLO has repeatedly insisted that there is nothing in the USMCA that would impede his reforms, and the United States, for its part, has been careful to couch its language, talking of “potential violations” of the agreement without categorically stating whether they actually exist. It is important, then, that Mexico resist the Biden administration’s attempt at bullying, call its bluff, and pass its energy reform. In light of a hardening international situation, however, it must be under no illusions that the battle will then be over. If the geopolitics of energy were central before, the events of the last two months have raised the wager substantially.