[Congressional Record Volume 141, Number 17 (Friday, January 27, 1995)]
[Senate]
[Pages S1697-S1699]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]


                   FREE TRADE WITH AN UNFREE SOCIETY


                       Mexico as a Leninist State

  Mr. MOYNIHAN. Mr. President, of the many novel ideas which we 
associate with the advent to office of Representative Newt Gingrich as 
Speaker of the House, none is more singular than his suggestion that we 
would all do well to read, or perhaps reread, ``The Federalist.'' As a 
New Yorker, I much applaud the proposal, and would presume on the 
Senate's time to invoke that venerable tradition in the context of the 
current debate over the proposed United States guarantee of Mexican 
debt.
  The most striking, at least to my mind, of those 85 essays by James 
Madison, Alexander Hamilton, and John Jay is the assertion that the 
proposed new Constitution was based on a ``new science of politics.'' 
If I may cite a commentary of my own, written some years ago, the 
establishment of the American Government in the latter part of the 18th 
century took its foremost distinction from the belief of those involved 
that they were acting upon scientific principles. Hamilton noted, in 
the ninth ``Federalist,'' that previous republics had had such stormy 
histories that republicanism had admittedly fallen somewhat into 
disrepute. This tendency could be overcome thanks to progress in 
political science:

       The science of politics * * * like most other sciences, has 
     received great improvement. The efficacy of various 
     principles is now well understood, which were either not 
     known at all, or imperfectly known to the ancient.

  He went on to cite, as examples of new discoveries, the various 
constitutional provisions with which we are now familiar, separation of 
powers, the system of checks and balances, popular representation in 
the legislature, the independent judiciary, and so on.
  How exactly had the ``efficacy of various principles'' come to be so 
``well understood''? By scientific method, of course. Which is to say, 
the deductive analysis of available data. Which, in turn, is to say the 
study of different systems of government which had prevailed at 
different times and places in the past.
  No. 18:

       Among the confederacies of antiquity, the most considerable 
     was that of the Grecian Republics associated under the 
     Amphyctionic Council.

  No. 17 (by Hamilton, naturally):

       When the sovereign happened to be a man of vigorous and 
     warlike temper and of superior abilities, he would acquire a 
     personal weight and influence. * * * Among other 
     illustrations of [this] * * * truth which might be cited 
     Scotland will furnish a cogent example. The spirit of 
     clanship which was at an early day introduced into that 
     kingdom, uniting the nobles and their dependents by ties 
     equivalent to those of kindred, rendered the aristocracy a 
     constant overmatch for the power of the monarch; till the 
     incorporation with England subdued its fierce and 
     ungovernable spirit, and reduced it within those rules of 
     subordination, which a more rational and a more energetic 
     system of civil polity had previously established in the 
     latter kingdom.

  No. 19:

       The examples of ancient confederacies * * * have not 
     exhausted the source of experimental instruction on this 
     subject. There are existing institutions, founded on a 
     similar principle, which merit particular consideration. The 
     first which presents itself is the Germanic Body.

  This is but a sampler. ``The Federalist'' abounds in analysis of the 
principles on which different states are founded, and the successes or 
failures, the strengths and weaknesses associated with each.
  It is an unequaled analytic tradition. The more troublesome, then, is 
its disappearance in our time. Notably in the matter of our relations 
with the State of Mexico.
  From the time it was first proposed that we enter a free-trade 
agreement with Mexico, I have objected for a single reason.
  Mexico is a Leninist State.
  The Leninist State is the most noteworthy, if calamitous, political 
invention of the 20th century. Having just come through a 70-year 
struggle with the original such State, formed as the Union of Soviet 
Socialist
 Republics, you would suppose we would be able to recognize one on our 
southern border. But then you might suppose many things about the 
analytic reach of the Department of State and of Treasury, only to be 
disappointed. Note that the American Labor movement had no such 
difficulty.

  Let me hasten to state that Leninist principles were never fully 
deployed in Mexico. There was no Great Terror. Even so, ``Americas 
Watch'' records in a 1992 assessment that ``torture is endemic'' in 
Mexico. Which is to say, State torture. Political opponents are 
murdered. Elections are propaganda exercises, and so forth.
  The central principle of the Leninist State is that a single 
political party holds sway over the whole of society, and in 
particular, governs the government. We know from the Soviet experience, 
and for that matter from the Mexican experience, that this is never 
wholly successful. Yet it is the principle. Hence, the Partido 
Revolucionario Institucional. Literally translated, the Party of the 
Institutional Revolution.
  The simple fact is that the Russian Revolution made a great 
impression in Mexico--as it did in the United States and most countries 
in the world. But unlike most, Mexico set out to reproduce the Soviet 
model. So much that when Trotsky fled the Soviet Union, now controlled 
by Stalin, he did not settle in Paris, as failed revolutionaries were 
expected to do; he went instead to Mexico City. Upon his arrival in 
1937, Trotsky saw that Mexico was a 
[[Page S1698]] place where he could continue his work. Here was an 
important battleground in the struggle to win international support for 
Marxism. He wrote:

       Of all the Spanish-speaking countries, Mexico is virtually 
     the only one where the necessary freedom exists for the 
     dissemination of the Marxist word. This international 
     situation assigns a leading role to Mexican Marxists not just 
     with respect to Latin America, but with respect to Spain 
     itself, as well the growing Spanish emigration to all 
     countries of the Old and New World. * * * History has 
     assigned serious responsibilities to Mexican Marxists.

  Stalin, of course, pursued him. But Trotsky's myth persists in 
Mexico. This from the August 27, 1990, issue of Newsweek:

       Leon Trotsky? The man who applauded the arrest of dissident 
     factions of the dawn of the Russian Revolution? The military 
     commissar who argued for the coercion of workers into 
     industry and preached that the Soviet Union should be a 
     springboard for world revolution? This week, on the 50th 
     anniversary of his assassination at the order of Joseph 
     Stalin, Leon Trotsky is being hailed in Mexico as a prophet 
     of perestroika, an avatar of socialism with a human face. The 
     Mexico City government has spent more than $100,000 to 
     restore the house where Trotsky died; the elaborate ceremony 
     to make its reopening this week was to be presided over by 
     the mayor. ``This anniversary * * * is our chance to show 
     that socialism still has validity,'' Aguilar insists, ``that 
     it can still be identified with human rights.'' Exclaims 
     political scientist Paulina Fernandez: ``Trotsky represents a 
     badge of honor for communism today.''

  This may seem sentimental and harmless; and to a degree it was. But 
in foreign affairs, for example, the Government of Mexico made itself a 
firm ally of Marxist causes throughout the cold war. At the United 
Nations it would occasionally vote with the United States, mostly by 
accident. But in General Assembly votes 1975-90, it voted with the 
Warsaw Pact 90.3 percent of the time. I was present as U.S. 
Representative in 1975 when Mexico joined the Soviet Union and 70 of 
the most obnoxious dictatorships in the world in the infamous 
Resolution 3370, declaring Zionism to be a form of racism. Mexico had 
no part in the quarrels of the Middle East, but that was the party line 
and the Partido Revolucionario Institucional toed it.
  Mind, by 1990 the Leninist regime in Mexico was coming apart, much as 
it was in Russia. The regime had long since become corrupt; rather, the 
corruption had long since become evident. A kind of division of the 
spoils took place. Intellectuals were given foreign policy. Viva Fidel 
and all that. Entrepreneurs were given industry--such that in 1993, 
President Salinas could hold a fundraising dinner at $25 million a 
plate. Party bosses were given various fiefdoms--to use a feudal term--
probably including portions of the drug traffic. And so it went. 
Workers got little; peasants got nothing.
  Then reform appeared.
  The central organizing principle of the P.R.I., one which had indeed 
brought stability to the Mexican State after decades of bloody chaos, 
was the single term, 6-year Presidency. In 1988, the P.R.I. chose 
Carlos Salinas de Gortari, who had earned a Ph.D. in government at 
Harvard. Others like him appeared in Mexican Government circles. It is 
not clear to me how much they rejected the Leninist model of the 
Mexican State. Surely they accommodated it; almost certainly, however, 
they recognized that it didn't work well. In the Leninist tradition, if 
you will, this brought about vicious intraparty conflict. To succeed 
Salinas, the P.R.I. chose Luis Donaldo Colosio, who attended the 
University of Pennsylvania, to be the next President of Mexico--this 
choice was probably dictated by Salinas, one of the inducements to 
giving up office in the Mexican manner is the power to choose one's 
successor--Colosio was assassinated in Tijuana in March, 1994. Among 
those subsequently arrested were local P.R.I. opponents of Colosio. 
Probably in the same pattern, in September, 1994, Jose Francisco Ruiz 
Massieu, the reform minded Secretary-General of the P.R.I., was 
assassinated in Mexico City. The main suspect has evidently implicated 
other P.R.I. officials in the killing. In the meantime, in Chiapas, 
followers, or descendants, or what you will, of Emiliano Zapata brought 
about an internal rebellion. Zapata, who had written in 1918:

       Much would we gain, much would human justice gain, if all 
     the people of our America and all the nations of old Europe 
     should understand that the cause of revolutionary Mexico and 
     the cause of Russia, the unredeemed, are and represent the 
     cause of humanity, the supreme interest of all oppressed 
     people. * * * It is not strange, for this reason that the 
     proletariat of the world applauds and admires the Russian 
     Revolution in the same manner as it will lend its complete 
     adhesion, sympathy and support to the Mexican Revolution once 
     it fully comprehends its objectives.

  That was then. It is now 1994. Mexico has entered into a free-trade 
agreement with the United States and Canada. There will be a 
Presidential election in August. The regime is in peril. A fixed 
exchange rate is maintained to ensure a large inflow of U.S. consumer 
goods to produce a sufficiently satisfied electorate. A huge foreign 
debt ensues. Followed in turn by devaluation and the present crisis of 
1995.
  Surely, this could have been anticipated as a possible if not 
probable sequence. It was not. Two successive administrations went 
forward with NAFTA with the same confidence that had attended our 
earlier free-trade agreement with Canada.
  I have no explanation for this. None has been proffered--note that 
A.M. Rosenthal argues in this morning's Times that there is a need for 
testimony under oath. A plausible explanation would be that our policy 
makers looked upon Mexico as a typical Third World economy which had 
adopted a policy of import substitution as a means towards industrial 
development. This was common enough economic strategy in the 
postcolonial period. Charles P. Kindleberger notes that it was indeed 
the much respected prescription of eminent economists such as Raul 
Prebisch of Argentina and Gunnar Myrdal of Sweden. India would be a 
good example of a democratic developing nation that opted for this 
strategy. By the beginning of the 1990's, however, the Indian 
Government was changing its view--even as at the beginning of the 
1980's it had faced a foreign exchange crisis.
  Surely, Mexican Government officials, under the influence in part at 
least of American economists, had also begun to change. The collapse of 
the Soviet Union hastened this appreciation in the value of American 
degrees. Just this Monday a poor fellow was ousted from President 
Zedillo's cabinet for having falsely claimed to have a doctorate from 
Harvard. But old habits die hard in a still theoretically one-party 
State. A free-trade agreement necessitates a flexible exchange rate to 
correct imbalances in the flow of imports and exports. Even so, the 
Salinas government maintained a fixed exchange rate until after the 
election. Then came the crash.
  At this point I would like to make a seemingly contradictory 
argument. I opposed NAFTA. First, I voted against President Bush's 
request for ``fast track'' authority. Then, in 1993, I voted against 
the resulting agreement. I was then chairman of the Finance Committee. 
I did nothing whatever to hold up the agreement, and I might have done. 
To the contrary, I saw to it that it was reported out of the committee 
promptly. When it came to the floor, I asked my colleague Max Baucus, 
then chairman of the Subcommittee on International Trade, to manage 
time in support of the bill. Which thereupon passed.
  My objections, which I believe I stated clearly enough, were 
political more than economic. I did not believe that the United States 
appreciated the troubles that would almost surely come of entering into 
so close a relationship with a polity so very different from our own; 
different in ways that could bring about a crisis such as that of the 
present.
  Nonetheless, I fully support Federal Reserve Chairman Alan Greenspan, 
Secretary of State Warren Christopher, and Secretary of the Treasury 
Robert Rubin in their advocacy of a $40 billion loan guarantee fund for 
Mexico. My reasons are twofold. First, I have the uttermost respect for 
Dr. Greenspan and his associates in this matter. He asserts that he 
came to his present position ``with great reluctance.'' This week he 
told the Finance Committee that he all but detested the ``too big to 
fail'' argument, be it applied to banks or nations. And, yet, there was 
something to it. Just yesterday, he told the Foreign Relations 
Committee, ``If this were strictly confined to Mexico, there would be 
no purpose whatsoever in a 
[[Page S1699]] government loan guarantee.'' But the issue is not 
confined to Mexico. It is Dr. Greenspan's judgment that the economies 
of the whole of the developing world are potentially at risk. The 
Senator from New York is not about to hear such testimony from Alan 
Greenspan and pay no heed.
  Similarly, I was struck by the comment yesterday by my distinguished 
colleague, Paul Coverdell, not just incidentally former head of the 
Peace Corps, warning against demands for strict conditions on the loan 
guarantee which may ``inflame'' relations with Mexico. May, indeed. 
They most assuredly will. Then we shall have chaos on our hands; or 
rather, on our border.
  In my view, it comes to this. We probably ought never to have entered 
a free-trade agreement with a polity so very different from our own. 
But we did. And we now face the consequences. They are nothing we 
cannot manage. As the headline from an editorial in the Buffalo News of 
January 26, 1995 explains:

       It's risky, but U.S. has to try to rescue Mexico's economy


            location and trade links leave us little choice

  The true disaster would be to insist on conditions that would arouse 
all the hostility and hysteria of a nation of 93 million souls on our 
southern border who for almost the whole of the 20th century have 
defined themselves by what they loathed in us. Cuidado, amigos.
  Thank you, Mr. President, for your patience. I yield the floor.
  Mr. BYRD addressed the Chair.
  The PRESIDING OFFICER (Mr. Cochran). The Senator from West Virginia.

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