Middle-class Mexicans are rising in protest against nation's economic crisis

March 19, 1995|By Knight-Ridder News Service

MEXICO CITY -- With Mexico's economic crisis hitting pocketbooks hard, protest movements by angry middle-class citizens are gaining strength nationwide in the face of worsening unemployment and interest rates soaring over 100 percent.

The movements are a radically new phenomenon in Mexico. In no previous economic crisis in the nation's history have lawyers and doctors and store owners taken the path of protest. And rather than demonstrating against state ideology, a traditional target of the poor and disenfranchised, the anger of these professionals and business people is directed at banks and other corporations, as well as government economic measures.

It is those private institutions, the protesters believe, that are worsening the impact of a government austerity program by raising prices and interest rates to exorbitant levels, eliminating jobs and seizing assets of those unable to pay.

"Before, my husband and I never had economic problems. We never wanted for anything," said Maria Enriqueta Romero Olmedo, an accountant handing out protest leaflets in front of a bank. "Now, in place of advancing, we are going backward. And I am not ready to keep going backward."

The number of people behind the movements is unclear. But they are emerging as political forces to reckon with. Mexican political analysts say they have the potential to shape themselves into American-style lobbies that someday could influence government policy.

The best known of the movements, a broad-based group called El Barzon, demonstrated outside banks in 23 Mexican states, calling for a stop to skyrocketing interest rates on credit cards, car payments and mortgages that have climbed to between 110 percent and 143 percent.

At the same time, more than 5,000 bus drivers who bought their transport franchises on credit and now can't pay their bills made convoys to Los Pinos, the Mexican White House, to call attention to their plight.

Interest rates climbed again when the government set the benchmark rate for 27-day treasury bills at 82 percent in hopes of attracting foreign investment and stabilizing the wildly erratic currency. The rate boost, the latest in a series of increases that have raised the benchmark rate nearly sixfold since December, led banks to raise their prime rate to 110 percent, and consumer credit mounted even higher.

Those increases come on top of the painful austerity package put into effect earlier this month in an attempt to halt the crisis, which began three months ago when Mexico's leaders abruptly and awkwardly devalued the peso. The package includes a 50 percent increase in value-added taxes, 35 percent jump in gasoline prices, 20 percent boost in electricity costs and spending cuts.

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