Feb 6, 2017
The increase in gas prices by 20 percent and the price of diesel by 16.5 percent on January 1 provoked an angry reaction by the population in two thirds of the thirty-two Mexican states.
Almost a thousand stores were looted. There were many confrontations with the police, 1500 arrests and five deaths. Tens of thousands more stores closed out of fear of riots. One Mexican state tried to calm the looting by distributing gift cards paid for out of its own funds. But the anger did not subside; the demonstrations multiplied.
In this country, a big producer of oil but an importer of gasoline, the rise in prices came from a law passed in 2013 by the government of President Peña Nieto that ended price subsidies at the beginning of 2017. The goal was deregulation of gas and diesel prices.
In an attempt to calm the anger, the president of Mexico said that the increase in the price of gas didn’t come from this law, but from the increase in gas prices on the world market. He also said that gas price increases were a necessary sacrifice to preserve social programs. And at the same time he announced a ten percent reduction in the wages of the lowest paid government workers.
These arguments didn’t convince anyone, not the population, not the unions, not the students, not the bosses, not the clergy, nor even the politicians. These same politicians voted a number of times to raise taxes on gas which now represent 36 percent of the price!
All these institutions demand that the government roll back these price increases. In effect, if these prices are kept, they will lead to an increase in the basic price of goods. In one week, the price of a kilo of tortillas, the main food staple in Mexico, went up by 3 to 6 percent depending on the regions in the country.
The population’s reaction against this policy, which the government did not anticipate, has produced a political crisis. The party in power, the Revolutionary Institutional Party (PRI) accuses the opposition party, the Revolutionary Democratic Party (PRD), and its main leader, Manuel Lopez Obrador, of wanting to exacerbate the anger.
For the PRI, it looks bad. The election of Peña Nieto provoked massive demonstrations because people doubted the results. Then there were the scandalous deaths of 43 students in Iguala, massacred by a drug gang at the orders of a local politician. Now there are these continuing riots. One year out from the presidential election, the PRI has reason to fear.