Why Is Mexico’s President Lopez Obrador So Popular?

A resident rides a motorcycle by improvised homes on the outskirts of the municipality of … [+] Nezahualcoyotl on the edge of Mexico City.

Photo by Nathaniel Parish Flannery.

For decades, the residents in the peripheral low-income neighborhoods that abut Mexico City were little more than distant neighbors to the power brokers in the federal government in the capital. Today, many voters who live in the haphazard collection of multi-story cement block homes in the municipality of Nezahualcoyotl express satisfaction and support for Mexico’s current president, Andres Manuel Lopez Obrador, a charismatic populist who was elected in a landslide victory in 2018. In 2021, a candidate from the president’s MORENA party won the mayoral election in Neza, creating an additional bond between the municipality’s one million residents and Lopez Obrador’s administration.

Inside his three-story home in Neza, (the shorthand nick-name for Nezahualcoyotl), 28-year-old resident Benito Martinez has a political banner that reads “MORENA: The hope of Mexico” hung up as an improvised tent roof over his interior patio. Martinez explains that he thinks Lopez Obrador “has done good work. He’s helped a lot of people.”

Neza resident Benito Martinez (left) shares a laugh with his 63-year-old father inside their home in … [+] Nezahualcoyotl. Both men have favorable opinions of Mexico’s President Lopez Obrador.

Photo by Nathaniel Parish Flannery.

Martinez’s 63-year-old father, who was born in Oaxaca, and his maternal grandmother, who was born in Morelos, both receive food handouts from the federal government. His nephews get cash “scholarships” for attending school. His grandmother also receives cash payments from Lopez Obrador’s flagship Bienestar Pension for Elderly Adults program.

“My grandmother gets financial help,” he says.

For Martinez and many other residents, Lopez Obrador’s cash handouts represent a new relationship with a federal government that for many decades ignored them.

Neza was first settled in the 1950s by lower-middle-class families who left downtown Mexico City to buy inexpensive plots of land in an inhospitable desiccated lake bed on the outskirts of the metropolis. The first generation of Neza residents braved summer floods, muddy roads, and winter dust storms. The soil in the area was so salty that plants and trees wouldn’t grow. Most newcomers built small single-room dwellings. Nearly all the homes lacked plumbing or electricity. Residents walked long distances carrying heavy buckets of water back to their houses. Neza’s home-owners worked together to install a few dozen wooden posts to bring electricity into their neighborhood. Even as the municipality’s population exploded in the 1960s through the 1980s, as new residents poured in from surrounding states, politicians in the state government and federal government, both controlled by the semi-authoritarian umbrella Institutional Revolutionary Party (PRI), failed to invest public resources in improving the quality of life in the urban slum. By 1970, Neza had a population roughly the same size as Boston, with 670,000 residents. Many roads remained unpaved and public transit was totally absent, even though over 250,000 locals commuted into Mexico City every day. Government services like public education and local police were perpetually under-funded.

It wasn’t until 2000 that Mexico City’s metro expanded to add an additional line to nominally serve Neza’s residents. But even though the nearest metro stop was named Nezahualcoyotl in 2002, it would take residents on the far edge of the municipality nearly five hours to walk there. Instead, locals relied on privately operated network of “combi” buses, braving stick-up robbers during a slow-moving commute through traffic to the metro. In 2013, Neza finally inaugurated a modern Mexibus Rapid Transit Bus system. Today, many residents drive late model cars or use Uber instead of relying on the local buggy-style moto taxis. Overall, Neza has been a transformational force for residents who left rural communities for better jobs in the fringe of the capital’s urban economy.

Today, Neza’s residents are a mix of business owners, factory workers, service sector employees, and informal vendors. While the outer edge of the municipality still has some single-story cement-block shacks, most of Neza’s orderly, grid-style neighborhoods are filled with solidly built multi-story dwellings. Over the last few decades residents have added balconies and extra rooms to their homes. Multiple generations often live within the same house or collected together on the same street.

Most homes in Nezahualcoyotl are solidly built. Residents have added additional floors and rooms … [+] during recent decades. Over the last half century Neza has transformed from a peripheral slum into a middle class and working class enclave.

Photo by Nathaniel Parish Flannery

By some measures, quality of life in Neza has improved. According to a recent survey, only 98 of the 301,936 houses in Neza lack access to sewage. Only 170 homes lack electricity. Only 0.6% of the dwellings in Neza still have dirt floors. But, only around 3% of residents in Neza have private health insurance. Over 80,000 households (27% of the total) lack a computer or access to the internet. Neza now boasts wide avenues, paved roads, and shopping mall, but still has hardly any parks or green spaces.

Optimists might describe Neza as the cradle of Mexico’s emerging middle class. Pessimists dismiss it as the archetype of the modern Mexican under-developed industrial proletarian ghetto. Both perspectives have some merit.

What’s clear, however, is that President Lopez Obrador’s policies and rhetoric are resonating with Neza’s residents.

Public policy analysts, however, tend to have a less ruddy assessment of Lopez Obrador’s social spending.

Adriana Garcia, the Head of Economic Analysis at the NGO ¿Mexico Como Vamos? explains, “The main problem is that the social spending strategy of this administration is designed to attract the population to the government in the short term, but it doesn’t support the creation of skills that will help people in the medium and long term. It’s direct short-term transfers. People are not acquiring knowledge or labor skills.”

During the 1960s, 70s, and 80s, many residents from rural regions of Mexico migrated to … [+] Nezahualcoyotl. Even today, residents continue to visit relatives in the countryside and maintain strong cultural ties to Mexico’s rural traditions.

Photo by Nathaniel Parish Flannery.

Journalists have also alleged that Lopez Obrador’s tree-planting program, Sembrando Vida, might be channeling money to relatively wealthy households and also causing deforestation. Survey data shows that number of households in the lowest income decile that receive aid from the federal government has declined while the number of affluent families receiving benefits has grown.

The government has failed to provide a clear explanation on where much of the cash it disperses ends up. Over US$1.1 billion designated to be spent by parents to improve schools is unaccounted for.

Some of the expenditure is simply unsustainable. One of the most expensive programs is the US$20 billion subsidy Lopez Obrador is providing for gasoline this year, insulating middle class car owners from the effects of inflation. Gasoline subsidies will actually cost more than Lopez Obrador’s pet project, the US$15 billion Mayan Train he’s building for tourists in his home state of Tabasco.

Lopez Obrador has deflected criticism of his government’s spending patterns. He has one question for recipients: Are they happy?

And, so far, the answer seems to be yes.

As of October, 2022, 59% of Mexico’s residents approve of Lopez Obrador’s performance as president.

“The people are content. The people are happy,” Lopez Obrador claims.

The academics and analysts Lopez Obrador derides are skeptical.

Mariana Campos, an expert in government finances at Mexico Evalua, a think-tank, explains, “The biggest problem is that up until now it’s been about handing out money. There’s no logic other than giving money.”

Lopez Obrador seems to have a limited view of the role of government. Critics complain he is doing little to prepare Mexico’s industrial sector to compete with rapidly evolving manufacturing techniques being embraced by other advanced industrial economies. He continues to promote fossil fuel and downplays the relevance of electric vehicles. He is not an ambitious state-builder. His spending seems targeted to create a direct transactional relationship with voters. He largely ignores the more difficult tasks of strengthening government institutions or implementing plans for long-term economic development. The World Bank predicts economic growth in Mexico will slow to 1.5% in 2023.

Lopez Obrador defends his budget priorities saying, “the little that we have, we have to hand out equitably. If there’s a budget it’s for everybody, it’s public and it has to be divided up equally.”

Ahead of the 2024 election, a race a still-yet-to-be-determined candidate from Lopez Obrador’s MORENA party is widely expected to win, Lopez Obrador is ramping up spending on cash transfers.

In 2023, Mexico’s federal government will spend US$1.9 billion on cash rewards for residents who plant trees. The budget for the Pension for Elderly Adults program will be US$16.8 billion next year, up 34% from 2022. The budget for the controversial and opaque school rehabilitation program (La Escuela Es Nuestra) will jump by 84% to US$1.2 billion in 2023. Unless global oil prices fall, gasoline subsidies will also burn through tens of billions of dollars of the federal budget in 2023.

“We are a victim of two problems: we spend little and we spend poorly,” Campos explains.

Well-publicized social spending creates the illusion of government largess. It also masks the fact that tax revenues as percentage of GDP are low in Mexico in comparison to other industrial economies. Overall, in 2019 during Lopez Obrador’s first year in office, social programs in Mexico accounted for only 7.5% of GDP, less than a third as much as Denmark, which spent 28.3% of GDP on social programs. Both the U.S. and Canada allocate around 18% of GDP to social spending, more than twice what Mexico spends. Lopez Obrador brags that 70% of Mexican households receive support from his social programs. However, a survey from the federal government’s independent statistics institute (INEGI) found that only 25% of families in Mexico receive payments from Lopez Obrador’s programs. The reality lags behind the rhetoric, but the programs are still an effective political marketing strategy.

64-year old Neza resident Feliciano Godinez has a positive opinion of Mexico’s President Lopez … [+] Obrador.

Photo by Nathaniel Parish Flannery.

In Neza, the federal government’s new programs have been effective at cementing a fierce loyalty between residents and Lopez Obrador. Feliciano Godinez, a 64-year-old mariachi musician who has lived in Neza for 43 years says that he would vote for Lopez Obrador again in 2024 if Mexico’s constitution allowed sitting presidents to stand for a second term.

“I’ve seen a lot of improvements. [Lopez Obrador] has helped elderly people and young people,” he says.

Additional resource: Check out this podcast discussion with the Council on Foreign Relations’ Shannon O’Neil on current economic trends in Mexico.