Supreme Court overturns AMLO decree; president responds with another, deepening crisis with judicial branch
AMLO decreed his prestige projects 'national security' priorities, hastening their completion and ensuring opacity – until the court intervened.
Editor’s note: this edition of the newsletter includes articles on the Supreme Court ruling against AMLO again; AMLO’s expropriation of railway lines in southern Mexico; Mexico threatening USMCA action against Texas truck inspections; Mexican immigration officials moving migrants to the southern border; violence in Tamaulipas; and AMLO finally selling the palatial presidential aircraft.
Mexico’s supreme court dealt AMLO another blow this week, annulling an attempt at decreeing his prestige projects national security priorities – deepening a conflict between the court and the president as the latter pushes the country toward a constitutional crisis.
In an 8-3 decision, the high court invalidated a November 2021 decree, which classified projects such as the Train Maya, several airports and an industrial corridor across the Isthmus of Tehuantepec to be national security priorities. The decree sped up or eliminated the permitting process or requirements for environmental reviews – part of AMLO’s push to finish his prestige projects prior to leaving office Sept. 30, 2024. It also kept information on cost overruns and contracting classified.
President Andrés Manuel López Obrador (AMLO) promptly responded to the May 18 decision by issuing a similar decree hours later. He blasted the decision the next day with his usual vitriol, accusing the court of being “completely against us and the transformation of the country.”
AMLO: a long history of opacity
The country’s transparency institute, INAI, brought the case to the high court. In his decision, Justice Juan Luis González Alcántara Carrancá said of the initial decree, “Its breadth and ambiguity hinders and inhibits the access to information … regarding the government of Mexico’s projects.”
But INAI has been paralyzed in recent months as the Senate – controlled by AMLO’s MORENA party – refuses to name commissioners to the institute’s board, leaving it unable to convene sessions due to a lack of quorum. (Past newsletters have addressed the president’s attacks on the INAI.) A judge on Friday ordered Congress to convene a special session to name at least one commissioner to the INAI board – giving it quorum.
AMLO has blasted the INAI as bloated and unnecessary. But he has a long history of opacity, dating back decades. How he financed his political activities between 2006 and 2018, when he quixotically toured the country and eventually built MORENA into a political juggernaut, remains a mystery.
As mayor of Mexico City in the early 2000s, he refused to make information public on his landmark infrastructure project, an elevated freeway which proved popular with the middle classes and was copied by politicians in other parts of the country. His government justified the opacity by stating:
“Because it is documentation and information that is subject to review and ruling, the disclosure or knowledge of which may create personal or undue advantage to the detriment of the (Federal District government) or its participants.”
Mayan train murkiness
AMLO has promoted the Train Mayan, which will circle the Yucatán Peninsula, as an engine of development in the country’s southeast – an area, he says, that has been long neglected as industry under NAFTA boomed in the north while the south remained something akin to Central America. Critics say the government hasn’t consulted with the indigenous Maya population and the railway cuts through ecologically sensitive jungle and will run atop a fragile landscape of soft limestone and cenotes (sinkholes.)
The railway is such a priority for the president that he tapped the military to build parts of it – along with a new airport in Tulum. (The military was also given operational control of the airports in Chetumal, near the Belize border, and Palenque.) A New York Times investigation found the railway was running three times over-budget and could cost $20 billion.
AMLO insisted on Friday that classifying projects such as the Train Maya as national security “does not mean we’re not going to inform.”
But he again accused critics – who he as branded “pseudo-environmentalists” – of trying to derail the project. Classifying it as national security and involving the army also seems to confirm a strategy of putting his prestige projects under military control to prevent future governments from privatizing or closing what could be unviable undertakings. He said Friday:
“We have to protect these projects because these senseless, irresponsible, corrupt, and, additionally, anti-patriotic people could stop us, as has been their intention. I’m not inventing anything; I’m not talking randomly. We have to protect these national security and public interest projects.”
Court decisions against AMLO
The high court has issued a string of rulings against AMLO in recent weeks, provoking efforts from the president’s partisans to embarrass court president Normal Piña by leaking private messages and even overhaul it by putting judges to direct election. The MORENA government of Veracruz even convened a mob, which carried coffins with several justices’ names to the court building in central Mexico City.
AMLO’s communications team has pursued the judges salaries – which come in at close to $400,000 plus benefits and have long surpassed that of the president, though AMLO slashed his salary by a further 60% to roughly $65,000 upon taking office. (The president’s finances have long been murky, but he’s used his supposedly low pay to put pressure on the directors of autonomous agencies unwilling to go along with his edicts. Journalists also calculate AMLO’s salary to be closer to $150,000 when benefits are included.)
Law professor Ana Laura Magaloni Kerpel – who was nominated for the Supreme Court by AMLO, but not confirmed (justices in Mexico are nominated in groups of three with one being selected by the Senate) – wrote of the attacks on the court in the newspaper Reforma:
“The president is not going to stop his campaign against the Supreme Court. The campaign is perfect for his objectives: cohere morenistas (his partisans) and his voters to confront the 2024 electoral process. What creates more cohesion between morenistas and his voters than feeling that they’re fighting a historic battle motivated by the collective indignation toward an elite and their privileges?
“That is what the President is talking about when he criticizes the court. The same thing happened in the case of the INE (National Electoral Institute.)”
The court overturned AMLO’s so-called “Plan B” on May 8, which attempted to gut the country’s electoral institute, ruling Congress failed to carry out a proper evaluation prior to approving the measures fast-track. In April, the justices declared unconstitutional a measure placing the National Guard (a militarized police force) under army command, even though the constitution mandates it has civilian leadership.
Snap expropriation
The day after losing in the Supreme Court, AMLO expropriated railway lines which will form part of an interoceanic corridor crossing the Isthmus of Tehuantepec, the skinny belt separating the Atlantic and Pacific Oceans.
Navy marines occupied three stretches of the Ferrosur railway in southern Veracruz state, taking control of the installations at 6 a.m. Friday morning. Ferrosur’s parent company Grupo México described a “surprise and unusual seizure of facilities” in a statement to the Mexican stock exchange – where its shares fell more than 4% that day.
It later said that it had been negotiating with the government. Grupo México had even started building parallel tracks in 2022 at its own cost after striking a deal – but that accord was later nixed by the government, it said.
The federal government described the expropriation as a “temporary occupation.”
The expropriation comes as AMLO pushes to finish his prestige projects – the Train Maya, a refinery in Tabasco and the interoceanic corridor, which calls for 10 industrial parks to be built and has been promoted as an alternative to the Panama Canal.
The timing of the expropriation also raised eyebrows: Grupo México owner Germán Larrea, Mexico’s second-wealthiest man, is expected to purchase Banamex, the Mexico assets of Citi. Larrea met with AMLO on Wednesday to discuss the deal, which the president has taken as special interest in – to the point that other bidders abandoned the process as AMLO imposed conditions and insisted the new owner be Mexican.
First expropriation
During his 2018 election campaign, AMLO promised no expropriations – a pledge to calm a business community spooked by his proximity to power and ice allegations (which sunk his 2006 campaign) that he would act like the late Venezuelan leader Hugo Chávez.
Interior minister Adán Augusto López insisted on Saturday that the expropriation wasn’t an expropriation, rather “a temporary occupation as the decree states. That’s not synonym for expropriation.” He also admitted that there had been negotiations with Grupo México, which failed to produce an agreement.
The expropriation provoked further fears of the AMLO administration scaring off investment – just as nearshoring (companies leaving China to produce closer to the U.S. market) is starting to show promise.
The Business Coordinating Council (CCE), which represents Mexico’s bigger businesses, said in a statement Saturday:
“Beyond the legal controversy of the decree, business leaders express their deep unease over the negative effects that these kinds of decisions generate in the confidence to invest in Mexico and create jobs at a time of great opportunities.”
Troops previously sent to US company’s installations
The Friday expropriation was not the first time that López Obrador sent soldiers to a private company’s installations. In March, he ordered troops to occupy docks owned by Alabama-based Vulcan Materials near Playa del Carmen. The Associated Press said of the intervention:
“López Obrador has been publicly sparring with Vulcan for over a year. He needs the dock to get cement, crushed stone and other materials into the area to finish his pet project, a tourist train known as the Train Maya.”
MEXICO THREATENS USMCA COMPLAINT OVER TEXAS TRUCK INSPECTIONS
Texas has resumed inspections of cargo trucks crossing from Mexico – prompting concern from the Mexican government, which has threatened to take the issue to a USMCA trade panel. The inspections have been occurring for cargo crossing from Matamoros to Brownsville, provoking delays of between eight hours and 27 hours and possibly causing spoilage of perishable items, according to the Mexico’s economy secretariat. The economy secretariat put trade between Texas and Mexico at $231 million annually.
Texas Gov. Greg Abbott first introduced inspections of Mexican cargo in 2022 to force action on immigration enforcement. Four Mexican states signed agreements with Texas to slow northward migration, but Mexican analysts have told this newsletter that subnational governments don’t set immigration policy and can take only limited action at best.
MEXICO MOVES MIGRANTS SOUTH
In a story Friday on the fallout since the end of Title 42 one week previous, The Washington Post published: “Biden administration officials have been publicizing their deportation operations since May 11.” That publicizing of deportations has been largely avoided by Mexico’s government, which has said little on its own actions to thwart migration or receive returned migrants since the end of Title 42.
Acting U.S. Customs and Border Security commissioner Troy Brown tweeted that migrants returned to Mexico “may be transported away from Mexico’s northern border.” He also tweeted – then deleted – that Mexico authorities had transported migrants crossing into Texas back to Tapachula near the Guatemala border.
The Associated Press reported Tamaulipas’ top National Immigration Institute (INM) official promising to voluntarily fly “as many migrants away from border cities of Reynosa and Matamoros as necessary.” The AP also confirmed flights from the border cities of Matamoros, Reynosa and Piedras Negras to the interior of the country last week – with 300 migrants being moved daily.
Stories have also started to emerge of shelters filling up in central and southern Mexico. The AP reported:
“The federal official said Mexico’s largest immigration detention centers are mostly empty. Two other federal officials, who also spoke on condition of anonymity, said Friday that ‘Siglo XXI,’ Mexico’s largest detention center, was empty.”
Shelters in Mexico City issued an urgent appeal for food and basics after the local government closed a camp for migrants in the Tláhuac borough. The INM said in a Saturday statement that it had transported 323 migrants camped in a park in the capital’s Col. Juárez to Chiapas.
Mass kidnapping of migrants in San Luis Potosí
Mexican security forces rescued 49 migrants kidnapped from a commercial passenger bus as it passed through the municipality of Matehuala, near the border of San Luis Potosí and Nuevo León states. Nine migrants from Honduras and Venezuela escaped their captors with the rest discovered during an operation by the National Guard.
The bus was first reported kidnapped by its owners, who said the assailants demanded $1,500 for each of the migrants. Two drivers were also taken, but found safe. The region in question, roughly halfway between Mexico City and the Texas border, has experienced a spate of kidnappings, including 121 migrants grabbed from busses in April. The INM says 2,115 migrants were rescued from gangs in Mexico during 2022.
AMLO to migrants: don’t risk Mexico
AMLO has often taken offence to suggestions that parts of Mexico are unsafe and controlled by criminal groups. But he warned migrants last that they “run many risks” transiting the country. He said Wednesday:
“It’s this, which is regrettably present, that there are kidnapping groups. Hence, the call also for our brother migrants to not allow themselves to be tricked, manipulated by traffickers, by coyotes, by polleros, who tell them that if they get five, $6,000, $8,000 they’re going to put them in the U.S. But they have to cross Mexico. They run many risks, many risks.”
CARTEL INTERROGATES PASSENGERS ARRIVING IN NUEVO LAREDO
Nuevo Laredo has long been a no-go for travellers as the city opposite Laredo, Texas, has been disputed by drug cartels wanting to control the busiest port of entry on the U.S.-Mexico border. The road between Nuevo Laredo and Monterrey has been rife with disappearances as motorists – including many Uber and Didi drivers – were presumed to have been grabbed by criminal groups wanting to know the identities and activities of unknown individuals.
Now “halcones” (lookouts) for the Cartel del Noreste are interrogating passengers leaving the Nuevo Laredo airport. A journalist with the newspaper Reforma reported taking a taxi from the airport, only to be stopped by a presumed “halcón,” who asked, “Reason for you trip?” The interrogation occurred near the airport, in front of military personnel.
The taxi driver involved in the stop said the stops are routine, responding to a question on what happens if he doesn’t stop: “They’ll follow me and f*ck me up.”
Shootouts, meanwhile, continued in Tamaulipas state, with videos being posted by Nuevo Laredo residents seeking shelter amid running gun battles.
For his part, state Gov. Américo Villarreal – who previously asked residents to not speak of insecurity – tweeted all was well in Tamaulipas, which he claimed ranked among Mexico’s 10 most secure states.
IS THE CJNG TAKING OVER TAMAULIPAS?
Violence erupted in Tamaulipas in late April as the it was believed the Jalisco New Generation Cartel (CJNG) was attempting to take territory in a state coveted for moving contraband and migrants to Texas and the United States. InSight Crime carried out an on-the-ground report, which concluded:
“While some believe the CJNG’s invasion of Tamaulipas is all but a sure thing despite the Gulf Cartel’s deep historical roots here, others say the situation is more nuanced and caution that any declarations regarding dominance disregard the reality of most criminal dynamics: The home team nearly always has the advantage.”
The report – well worth reading – found evidence of the CJNG establishing itself in Reynosa, just south of McAllen, Texas. InSight Crime cited sources and U.S. Customs and Border Protection data, showing a spike in seizures of cocaine and methamphetamines – with prices for the drugs drastically dropping. InSight Crime wrote:
“These seizures and seismic drops in wholesale prices suggest these drugs are flooding across the border into this region of south Texas.
“It is a change from the past when the Metros, a former faction of the Gulf Cartel that has operated independently for years, moved modest amounts. Those Metros were part of an extremely volatile and fragmented corridor and, at best, held but shaky control of Reynosa and this border crossing. For US officials, the recent drop in price and rise in seizures points to a bigger, more powerful organization: the CJNG.”
U.S. border officials are also starting to find fentanyl – a drug produced more in western Mexico and moved across the U.S. border into western states.
The CJNG has targeted Reynosa, according to inSight Crime, with the ultimate goal of surrounding and seizing Nuevo Laredo – coveted for its enormous commercial traffic, which has caused no shortage of cartel conflicts over the past two decades.
MEXICO’S DEFENCE SECRETARY PURCHASES LUXURY PROPERTY FROM CONTRACTOR
A recent investigation from anti-graft group Mexicans Against Corruption and Impunity (MCCI) showed defence secretary Gen. Luis Cresencio Sandoval and his family jet-setting around the world – despite AMLO’s stated policies of punishing austerity in public administration.
Another MCCI investigation shows the defence secretary purchasing a luxury apartment from a crony contractor for below-market value. Sandoval reported purchasing the nearly 4,400 square-foot apartment in the posh Bosque Real part of suburban Huixquilucan for 9 million pesos ($450,000). But MCCI found most properties of similar size in the neighbourhood sold for triple that price.
MCCI also discovered the general bought the apartment from a contractor, who had sold SEDENA bulletproof vests worth 319 million pesos (roughly $16 million.)
MCCI cited alleged irregularities in the bid and raised questions of the contractor’s ability to provide the bulletproof shields. An investigation by the publication Capital found the bulletproof shields were sourced from China and “would only be relabeled and repackaged in the United States, a manoeuvre that would have raising the price as its objective.”
Sandoval: I got a good deal on a “project under-construction”
Sandoval, who had stayed mum after the investigation into his family’s luxury travels, spoke on the apartment at AMLO’s press conference. He insisted that he didn’t know the owner and only had dealings with their real estate agent. He also said the company in question only won a single contract – two years after the real estate sale – but had bid on various occasions.
Sandoval continued: “I acquired it for the price stated in the story, but story didn’t mention it was under construction. That building, that apartment, was 11 years old and for some reason the previous owners hadn’t done the finishing work.”
He also insisted that he apartment did not cost 30 million pesos and he purchased it with a loan from the Banco del Ejército. The bank, he says, valued the property at 9.8 million pesos.
Sandoval glossed over details of the MCCI investigation into his jet-setting family. He said his family travels with him often and that he has a team which helps with logistical matters.
AMLO defends general as ‘incorruptible.’
AMLO responded to investigation with his usual reactions: attack the messenger and vouch for the “honesty” of the person accused of misdeeds. He said of the army:
“You ask me if I have confidence in the armed forces, of course, and if I have confidence in the general, of course. Since I decided to invite him to participate, after an analysis, a review of all the files of all the division generals, and I came to the conclusion that the general, among other characteristics, among other virtues, is an honest person, incorruptible.”
AMLO also returned to an old refrain: moral authority – which he boasts of having, as opposed to his “adversaries.”
“Our protective shield is our moral authority that we have. We are going to continue resisting, the campaigns against my children, the harassment. Nothing happens because we have moral authority. The blows have intensified lately, the attacks on the government because they want people to conclude: they’re all the same.”
Casa Blanca 2.0
AMLO says ad nauseam, “We’re not the same” as the politicians preceding him and his party. But the episode of the defence secretary buying a home from a contractor and one of his sons enjoying homes owned by people whose firms are linked to the government revived memories of the “Casa Blanca” scandal of the 2012 to 2018 administration of president Enrique Peña Nieto.
The scandal involved a $7 million mansion which the then-first lady Angélica Rivera purchased from a crony contractor in 2014 – sinking the former soap opera star’s public image. It was followed by revelations then-finance minister Luis Videgaray also bought a home from a contractor at the centre of influence peddling operations.
Journalists from Aristegui Noticias exposed the Casa Blanca scandal. They later revealed that their initial inspiration for investigating the home was the first lady herself, who boasted of the purchase in the society glossy ¡Hola! and invited the magazine to publish photos of the palatial property.
THE PLANE ‘NOT EVEN OBAMA HAS’ FINALLY SELLS
On a 2016 rally in Ciudad Victoria, Tamaulipas, AMLO banged on about a familiar theme: the presidential aircraft – which was so opulent “that not even Obama has this plane,” he would often quip. He often promised to sell it to then-president Obama (and later then-president Trump) and said at the rally in Ciudad Victoria: “If Obama doesn’t want it, we will look for another small pharaoh capable of buying the plane.”
AMLO found that small pharaoh recently in the form of Tajikistan president Emomali Rahmon, whose country bought Mexico’s presidential aircraft – a custom 787-8 ordered in 2012 - for $92 million. The central-Asian country ranks 158th of 180 countries in Transparency International’s 2022 Corruption Perceptions Index – far below Mexico’s ranking of 126.
The aircraft represented the perfect populist trope for AMLO, who railed on about it endlessly as a symbol of his predecessor’s profligate spending while Mexicans were wallowing in poverty. Revelations of a Peña Nieto’s guests racking up staggering bar bills onboard only seemed to confirm AMLO’s arguments.
AMLO promised to sell the aircraft upon taking office, but failed to find a buyer. (He also started flying commercial, which meant being incommunicado at times, such as when the army made a botched attempt at nabbing “El Chapo’s” son in 2019.)
Populist prop
But the aircraft served as the perfect populist prop. He campaigned for years on selling the presidential plane. During a 2016 rally ahead of state elections in Tamaulipas, he mentioned nothing of violence there – but spoke at length of the luxuries of the presidential aircraft. He even took issue with other functionaries using new private jets – including then-defence secretary Salvador Cienfuegos.
He promised the proceeds of the sale for various causes – even the funding of the first deployment of the newly formed National Guard, which was sent to the northern and southern borders to avoid Trump’s threat of imposing tariffs if migration wasn’t halted.
At one point, AMLO even promised to raffle off the aircraft – which he did, sort of, in 2020 with 20 prizes of 20 million-pesos offered instead of the actual Dreamliner and some of the tickets benefitting downtrodden schools and health clinics in the boonies.
Upon selling the aircraft, AMLO promised to uses the proceeds for building hospitals in Guerrero and Oaxaca, two of Mexico’s more marginalized states.
Returning ‘stolen’ assets to the poor
The promise of pumping money AMLO considers poorly spent or stolen underpins part of his success: putting him on the side of the pueblo against a supposedly rapacious elite. It’s worked wonders for a president who has overseen a stagnant economy, underwhelming pandemic response and rampant insecurity. As political analyst Luis Antonio Espino told The Globe and Mail:
“It’s all a narrative in which the government and the president are taking money [from corrupt politicians] and giving it to them. It gives the satisfaction of saying, ‘He’s punishing them and giving something to me.’ It’s very powerful so things like the economy and the pandemic don’t matter.”