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The first time the PRI officially lost a gubernatorial election

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The first time the PRI officially lost a gubernatorial election

A House Divided Against Itself:

    *The PRI’s Survival After Hegemony

    Federico Estévez

    Instituto Tecnológico Autónomo de México (ITAM)

    Political Science Department

    Río Hondo N? 1, Tizapán-San Angel

    01000 México DF

    festevez@itam.mx

    Alberto Diaz-Cayeros

    Stanford University

    Political Science Department

    616 Serra Mall

    Stanford CA 94305

    albertod@stanford.edu

    Beatriz Magaloni www.Stanford University

    Political Science Department

    616 Serra Mall

    Stanford CA 94305

    magaloni@stanford.edu

     * Prepared for the Conference “Learning to Lose: Adapting to Democracy in One-Party Dominant

    Systems”, March 31-April 1, 2006, University of Toronto, Toronto, Canada.

1. Introduction

    “If we do not win the big house, let us give up on the future of our political organization” (El Universal, March 2, 2006). With these words Roberto Madrazo,

    presidential candidate of the Partido Revolucionario Institucional (PRI), expressed the uncertainty as to whether his political party, which kept hegemonic control of politics in Mexico during 71 years, would be able to survive into the democratic age without controlling the presidency.

    This paper explores the transformation of the PRI and its survival dilemmas during the democratic era. Mexico unambiguously transited to democracy in 2000 once

    1the PRI lost the presidential race, recognizing its defeat. At the time political observers

    and scholars were divided in their forecasts about the fate of the PRI. Some believed the party would not be able to survive democracy. Others believed that since the party retained a formidable machine in vast areas of the country and still controlled the corporatist organizations and the vast majority of executive posts (governorships and mayoralties), it would be able to survive and perhaps make a comeback in the 2006 elections. The first scenario was one of collapse of the traditional political system, similar to what occurred to the Christian Democrats in Italy; the second scenario looked more like the reconstitution of Communist Parties in many countries in Eastern Europe.

    The PRI faces slim odds (as we write) of regaining control of the presidency in the 2006 elections. Opinion polls place the party in third place (CIDAC Electoral, 2006).

     1 The timing of Mexico’s transition to democracy is somewhat problematic. The PRI had won a clean and relatively fair election in 1994, and had already lost control of the federal legislature since 1997, but alternation in executive power provides a clear threshold to qualify the country as democratic (see Przeworski et. al. 2000).

    But the party is far from dead. In this paper we argue that the PRI is alive and strong, although it does face a real danger to disintegrate. The strength of the PRI, we demonstrate, lies in it impressive capacity to win state-level elections. After the presidential defeat in 2000, the PRI continues to be the strongest party at the subnational level. The electoral success of the PRI at the local level results from a combination of factors. The democratic era has witnessed a dramatic transformation of the rules for selecting party nominees -- the central leadership has gradually been displaced in favor of local-level party conventions and primary elections and this has allowed the PRI to pay

    closer attention to its local electorates. Furthermore, governors in the contemporary era have access to incredibly enlarged fiscal federal transfers that were made available through fiscal decentralization, which originally was a by-product of the democratization process. Originally given as a pay-off to obtain the cooperation of the long-standing opposition party, the PAN (National Action Party), fiscal decentralization has paradoxically been capitalized by PRI governors to entrench themselves in power. As a consequence of all of these processes, power within the PRI has dramatically shifted from

    2the national leadership to the governors and the local electoral machines’ rank-and-file.

     The future of the PRI, however, hinges upon its ability to win national elections,

    including the presidential race. To win national elections, the PRI must be able to accommodate a very heterogeneous set of actors, most notably the governors and their local electoral machines. Having lost the presidency and unitary control of the vast resources in the federal bureaucracy that had traditionally been used to glue its coalition, the PRI faces formidable challenges to keep united. What are the factors that pull the

     2 A point made quite presciently by Trejo, 2000.

    national PRI apart? Can clearly identifiable factions within the former ruling party be identified?

     In this paper we answer these fundamental questions. Our analysis first supports our claim that the contemporary PRI is fundamentally a collection of highly entrenched governors. We then proceed to systematically assess the dynamics of internal party factionalism or the variables that lead governors to fall in one faction or another. In line with conventional wisdom, we identify two main factions within the PRI, a left-wing populist faction and a liberal, free-market one. We depart from most analyses, however, in tracing factionalism to ideological divisions. These policy-divisions, we argue, result from regionalism, and in particular, from the socioeconomic characteristics of the politician’s state, including how well the local economy performed during the years of Import Substitution Industrialization (ISI), the state’s economic performance during the

    more recent years of structural adjustment and market reforms, and its exposure to international trade. The main line of division within the PRI thus mirrors the tremendous regional disparities in the country and constitutes a serious impediment that prevents the national party organization from aggregating interests and articulating a coherent national agenda.

     The paper is organized as follows. The first section presents a general background of the PRI as it pertains to the roles of governors and factions during the hegemonic period. The section discusses the transformation of the nomination procedures within the PRI that bolstered the party’s decentralization and the devolution of economic power to the governors that resulted from fiscal decentralization. The third section analyzes the electoral resilience of the contemporary PRI looking at the party’s capacity

    to win state level elections. The fourth section discusses the problem of internal divisions within the national PRI. We end with a conclusion.

2. The hegemonic rule by the PRI

     The PRI was able to put together a regional and functional coalition which ruled Mexico from 1929 to 2000. The regime, although clearly autocratic, was more benign than any of the dictatorships in the rest of Latin America, and the political system was remarkably stable. During those long years of hegemony the party was able easily to win elections, only resorting to electoral fraud as an exceptional device. Before the 1980s, the party usually won, with hefty margins of victory, all state, municipal, and congressional elections.

     The central pillar of the PRI regime was its monopolization of mass support (Magaloni, 2006). Mass support was obtained through a combination of factors including economic performance; the distribution of material rewards at the time of the elections

    everything from land titles, to subsidized credit, construction materials, and food baskets and the mobilization of voters through the party’s wide-reaching clientelistic networks.

    The PRI resorted to the mobilization of mass support much before elections became competitive in the 1980s as a means to deter elite opponents, most fundamentally those coming from within the ruling party (Magaloni, 2006). During the hegemonic era, the key vulnerability of the PRI was internal party divisions coming from disgruntled politicians who were denied the party’s nomination. Major splits occurred in 1940, 1946,

    1952 and 1987 when powerful politicians who did not obtain the presidential nomination

    opted to challenge the PRI for the presidential race as opposition. The 1987 split was different from previous ones because it resulted in the formation of a new political party, the Party of the Democratic Revolution (PRD). Through the mobilization of mass support, the PRI aspired to generate an image of invincibility. As long as the population kept on supporting the ruling party, ambitious politicians could anticipate no hope of achieving office and access to government spoils if they exited the hegemonic coalition.

     Ideological divisions existed within the PRI since it was created in 1929. However, ideology has never fit well into any standard account of the PRI, as perhaps should be expected of a party founded on revolutionary ideals refashioned into the populist and corporatist creed that held reign during its long passage in power. Once hegemony was fully established, in the 1950s, a cohesive ideology could not account for so broad a coalition of support nor so virtually monolithic a political organization. Indeed, the driving force behind PRI dominance was usually hailed as its pragmatism, adjusting policy to evolving changes in national and international conditions.

     Scholars focusing on the study of factions rarely underscored ideology as a possible source of internal party divisions. Factional disputes were taken to be power struggles among personalistic cliques or camarillas (Smith; Langston) embedded within

    party organizations and government bureaucracies, awaiting the turn of the wheel of fortune in the presidential and gubernatorial sweepstakes and accommodating the latest ideological fashions of the politicians at the top. Figuring prominently among the cliques were those known as cacicazgos, dynastic political clans concentrated in particular states which have survived decades of political turnover within the ruling party. The twists and turns of this process were schematized as the “pendular theory” of presidential change

    over time (Cornelius) which entailed changes in ideological shading according to the impact of presidential (and gubernatorial) succession on the configuration of interests within the party.

    Another feature of Mexican autocracy was that it held regular elections, at all levels of government, since 1918. Although there was undoubtedly a large degree of centralization of political power in the hands of the president, state elections were a crucial feature explaining the stability of this political arrangement (Diaz-Cayeros, 2006). Federalism afforded politicians at the local level the possibility of pursuing attractive political careers in their states, enjoying the benefits of federal resources and national organizations to mobilize political support.

    Although the conventional wisdom considers governors during the hegemonic era as mere administrative agents of the president in local arenas, political stability was predicated upon their authority at the state level. The president sometimes removed governors and tried to appoint friends, allies and collaborators to that position. But the overwhelming majority of the governors were already in office by the time a president’s

    term started, and presidents in Mexico never tried to cancel local or state elections outright (in the way that Vladimir Putin did in Russia in 2005).

    Thus, the PRI has always been a highly heterogeneous governing coalition of entrenched governors and local politicians; professional bureaucrats who followed their careers at the federal level; and officials from the party’s corporatists institutions, including the CTM (Confederation of Mexican Workers) and CNC (Confederation of Mexican Peasants). Ambition and rent-seeking rather than a common ideology were the cement that kept the heterogeneous coalition united for so long. All major politicians in

    the country remained within the PRI because only this party offered a real possibility of being elected to office or acquiring a bureaucratic position, both of which offered liberal access to government spoils and ample opportunities to do business under the umbrella of the state. During the hegemonic era the PRI managed to successfully balance the interests of such dissimilar groups by distributing spoils and legislative positions among the major corporatist organizations and the governors in a more or less proportional basis.

    The 1980s witnessed a redistribution of power within the PRI. As it became clearer that the CTM and the CNC were unable to effectively respond to the electoral challenges of the PRD and the PAN, the PRI began to redistribute power away from the functional organizations in favor of the governors. After 1988 almost half the members of federal cabinets had been governors. Furthermore, during the 1990s, the CTM and the CNC began to lose their traditional shares of legislative seats within the federal Congress.

    The redistribution of power from the center to the states became even more dramatic after the PRI lost the presidency in 2000. The PRI’s most important leaders

    during the democratic era have all emerged from the ranks of sitting and former governors, not from the federal bureaucracies or the corporatist organizations. In fact, as we further discuss in this paper, the strength of governors, and their ascendant role since the 1990s, explains the PRI’s capacity to survive democracy after its defeat in 2000.

    3. Devolving power to the states: fiscal decentralization and the transformation of nomination processes

     The era of party hegemony was characterized by an impressive centralization of power. During the era of party hegemony, the fiscal federal arrangement witnessed an

    impressive centralization (Diaz-Cayeros, 2006). The national government controlled most of the economic resources, which meant that state politicians had virtually no leeway to determine spending decisions. Governors depended on the center’s largesse to finance

    social development projects, infrastructure and public works, and administrative expenses. Public investment was highly skewed in favor of some states and cities, most notably Mexico City.

     During the more competitive era, the PRI was able to employ this fiscal centralization to its advantage. It undermined the opposition by systematically diverting fiscal resources from states and municipalities controlled by these parties and rewarding its own with more funds (Rodríguez, Diaz-Cayeros et al, Magaloni, 2006). Without access to federal fiscal transfers, opposition governments faced enormous challenges to govern and build solid party organizations at the local level.

     The distribution of funds from the federation to the states is governed by formulas that were negotiated between the states and the federation within a “federal fiscal pact”, the National System of Fiscal Coordination. These formulas were originally drafted in 1980 to compensate rich states for the loss of revenue resulting from the introduction of a national Value Added Tax (VAT). Gradually, the formulas evolved in such a way that poorer states, where the PRI is stronger, receive increasing shares. After 1993, the federal government devolved to the states education expenditure and a few years later funds for health and basic municipal infrastructure were decentralized. By 1998, the various subsidies granted by the federal government to finance the provision of public goods and services in the states were incorporated into the National System of Fiscal Coordination.

    Subsidies are supposed to be earmarked and conditioned in their use to further federal priorities. However, in practice states have ample leeway to allocate them.

     Revenue sharing funds are the other major federal funds that states can spend with discretion. When the PRI lost the majority in the Chamber of Deputies in 1997, this party was forced to build coalitions with other political parties to pass legislation. The PAN conditioned support of the budget on more transfers and programs to the localities.

     Figure 1 reports the evolution of federal transfers to the states from 1960 until the present. We report total federal transfers, federal public investment (IPF), revenue sharing funds, and subsidies as a percentage of the states’ average GNP. We also report

    the average real growth of transfers to the states in per capita terms. Except for the years of the oil boom in the late 1970s, there are significantly more resources to the states in the democratic era. Most of the increase after 1995 comes from revenue sharing funds and subsidies. Hence, a key difference in the contemporary period is that governors have virtually a free hand to use those resources at will, which was not true of funds in the 1980s. A paradoxical result of the fiscal decentralization that came about as a concession to the PAN is that PRI governors have been able to employ the increased resources to entrench themselves in power even after this party lost the presidency in 2000.

Figure 1

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