It’s rare for presidents to advocate for poverty, but that’s just what Mexican President Andrés Manuel López Obrador is doing.
At a press conference on Feb. 1, López Obrador said his government would embrace what he called “Franciscan poverty” if it would “transfer funds to the people” and achieve “development, jobs and welfare.”
Francis of Assisi was a Catholic saint who disdained material wealth to follow Christ as a poor man.
López Obrador’s poverty vow is more bureaucratic than religious. As part of an ambitious effort to fight poverty and reduce government corruption, the president proposed to cut the salaries of public officials, including his own, slash federal budgets and lay off 70 percent of non-unionized federal workers. An estimated 276,290 public employees will lose their jobs.
After lawsuits were filed by opposition political parties and Mexico’s National Human Rights Commission, the Supreme Court in December granted a temporary suspension of López Obrador’s new Federal Law of Public Servant Salaries.
Saying that even austerity budgets must guarantee the basic functioning of the government, Justice Alberto Pérez Dayán said López Obrador’s plan cannot go into effect until the Supreme Court rules on its constitutionality.
The decision has set up a standoff between the president and the courts, with Mexico’s federal budget and judicial independence hanging in the balance.
Reducing inequality, one tree at a time
López Obrador and his leftist Morena Party won a landslide victory in Mexico’s 2018 general election on promises that they would transform Mexico, empowering the underprivileged in a country with gaping inequality.
Since taking office on Dec. 1, López Obrador has suggested creating some 20,000 jobs in fruit production and wood harvesting by planting trees on a million acres of land in rural southern Mexico. He has also proposed paying small monthly pensions of up to 2,550 pesos – around US$134 – to Mexicans above the age of 68 and to people with disabilities who lack social security benefits.
Leftist governments usually fund social programs like this by raising taxes on the wealthy. López Obrador says he won’t do that. Instead, his administration hopes to recover public funds by cracking down on rampant corruption and saving money with fiscal austerity. That’s where the salary cuts and mass layoffs come into play.
López Obrador is an admirer of Benito Juárez, the indigenous president who ruled Mexico from 1858 to 1872. Juárez extolled the virtues of selfless public service, saying public servants should “devote themselves to work assiduously while resigning to live in … honorable modesty.”
He also set his salary at a “moderate” 108,000 pesos, about $5,700 a month – roughly $68,400 a year. That’s 60 percent less than his predecessor, Enrique Peña Nieto, who earned the equivalent of $14,200 a month in 2018.
The wage gap between average workers and the Mexican head of state was the highest in the world last year, according to a report by the IG Group, a British financial services company. On average, Mexican workers earn around $15,311 a year.
López Obrador’s voluntary pay cut has drastically reduced the difference between his income and everyone else’s.
Attacks on the judiciary
Since the Mexican Constitution mandates that no public official should make more than the president, however, López Obrador has also effectively capped wages for all government employees.