Friday, June 21, 2024

López Obrador announces new ‘Franciscan poverty’ phase of federal spending cuts coming

Although one critic called the concept ridiculous and sad, President López Obrador said this week that in order to reduce spending and improve the federal government’s battered financial health, all branches of his government are going to go into a period of “Franciscan poverty.”

“We are going to carry out additional austerity measures,” López Obrador said in his Wednesday morning press conference. “We are going to reduce a lot. There are going to be almost no trips abroad. We are going to ensure that almost all communication is done by telephone and videoconferences. We are going to reduce travel expenses and other measures.”

He said that although there are already austerity measures on the books, they are “not being complied with.” Then he added: “In any case, we are going to move from the Republican Austerity [Law] to a higher phase, which is that of Franciscan poverty.”

Poverty is one of the main tenets of Franciscans, a religious order within the Catholic faith. Saint Francis of Assisi, the founder of the order and one of the most venerated figures in Christianity, spent his life pursuing a “perfect poverty” and was said to be a suitor to “Lady Poverty.”

Profeco head Ricardo Sheffield
The planned budget cuts include reducing civil servants’ salaries. On Monday, AMLO had Profeco head Ricardo Sheffield list government officials who earn more than the president.

And now, apparently, so is López Obrador.

In his press conference during which he assured that he has not bought a new vehicle for federal officials since he has been in office he detailed some of the additional belt-tightening measures.

Civil servant salaries will be further reduced, and legal reforms will be made to ensure that high-ranking federal officials can’t seek injunctions against a reduced salary, López Obrador said. Nor will the republic acquire any more debt, although the president said he’ll simultaneously make sure that gas and food prices do not rise.

He promised a meeting with his cabinet to hammer out all the X’s and O’s and find additional things to cut. “The formula is simple,” he said. “It is zero corruption and austerity   to make funds available for development and to deliver resources to the most needy people.”

Mexican pension beneficiaries waiting in line for benefits
Antipoverty program beneficiaries wait in line. AMLO promised there will be enough money to continue to pay for such programs. File photo

So far, he said, his administration has saved some 2 billion pesos (US $98 million) thanks to austerity measures.

Earlier this week, Ricardo Sheffield, head of the federal consumer protection agency Profeco, presented a list of public servants who, in not complying with the Republican Austerity Law, are receiving a higher monthly salary than López Obrador. “Although our Constitution establishes that no one should earn more than the president, we find [in the government] that this decree is not respected,” he said.

Although López Obrador bragged at the press conference about savings in different areas, he did not address large cost overruns on projects such as the Maya Train, the Felipe Ángeles International Airport and the Dos Bocas refinery.

Some government officials said the president’s announcement was verification that the nation’s finances are in dire straits, that there are no additional sources of revenue that can be tapped and that Mexico’s financial future is teetering in the wake of a global economic crisis.

Mexican deputy Hector Saul Tellez
The Mexican legislature’s budget commission secretary Hector Saúl Tellez said Wednesday that money has been wasted on the president’s “pharaonic works” and on social programs “that have not generated better conditions for the population.”

Héctor Saúl Téllez, a member of the lower house of Congress and the Legislature’s budget commission secretary, said federal revenues are “not good” and if they are to be used “for the whims of the president,” public resources will have to be squeezed even further.

“The announcement that there will be a shift to ‘Franciscan poverty’ is very worrying at a time when we continue to experience budget shortages, where there continues to be a lack of resources for health [and] education,” said Congressman Salomón Chertorivski. 

He said that if the government carries out this type of plan, it needs to consider how to finance other needs in coming years, such as the payment of pensions. And he also said it’s “foolishness” for the government to continue subsidizing the price of gasoline at a cost of more than 300 billion pesos (US $14.8 billion).

“Saying that there are still more cuts to come is a shame, especially with the lack of growth, with the lack of recovery that we have had after the bad decisions throughout the pandemic,” he added. “The resources are simply not enough.”

Maya Train rendering
AMLO did not address his administration’s cost overruns on projects like the Maya Train, currently under construction. Government of Mexico

He also dismissed “Franciscan poverty” as merely a “flirtatious phrase” being invoked by the president, and called the concept ridiculous and sad. Likewise, Téllez charged AMLO with making a frivolous and populist statement, and he condemned López Obrador’s government for covertly spending 100 billion pesos (US $4.9 billion) on who knows what.

“What there has been is an embezzlement in budget revenues,” he said. “There has never been austerity … Money has been wasted in the president’s pharaonic works and on social programs that have been a waste because they have not generated better conditions for the population.”

The federal cabinet was to meet Thursday to discuss the new measures.

With reports from Animal Político and Reforma

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