MEXICO: Coverup of US Journalists's Murder Sets Stage for Privitization of Oil

[magbana]

FROM: JOHN ROSS
011-5255-5518-1213 X102
[e-mail]
Blindman's Buff #196

COVER UP OF U.S. JOURNALIST'S MURDER SETS STAGE FOR PRIVATIZATION OF MEXICAN OIL

MEXICO CITY (Jan. 22nd) - Flash back to October 27th, 2006. U.S. Indymedia
photojournalist Brad Will is splayed out on a sidewalk in Oaxaca Mexico,
mortally wounded by the pistoleros of rogue governor Ulisis Ruiz during
tumultuous street battles in that southern city. His killers have never been
prosecuted.

Now fast forward to this past January 10th. Manlio Fabio Beltrones, the
unctuous leader of the once-ruling (71 years) PRI party faction in the Mexican
Senate, announces to a gaggle of reporters that the PRI is prepared to back
President Felipe Calderon and his right-wing PAN in passing an "energy reform"
package that would permit transnational corporations to generate 49% of the
nation's electricity and open PEMEX, the state petroleum monopoly expropriated
from its Anglo-American owners in 1938 and nationalized by President Lazaro
Cardenas, to such oil titans as Exxon, British Petroleum, and Shell. Beltrones'
personal preference to initiate the proposed "association of private capitals":
Petrobras, the Brazilian national oil company which opened itself to private
investment back in 1997 and which has extensive experience in deep water
drilling.

What is the connection between these two apparently unconnected events, the
reader has a right to know. Just this: the cover-up of Brad Wills' death
smoothed the way for the PRI-PAN partnership to privatize PEMEX.

Although his killers were plainly identified as plainclothes police on Ulisis's
payroll, Wills' inconvenient death was ignored by then-president Vicente Fox
despite demands by human rights and journalist protection organizations for a
full investigation of the killing, o ne of 26 perpetrated by Ruiz's death squads
between August and October of 2006. Fox's successor, Felipe Calderon, followed
suit and stonewalled an inquiry into Wills' murder. Similarly, the U.S. Embassy
in Mexico never sought justice for a slain citizen despite the personal pleas of
the dead man's family.

Why such studied indifference?

Because holding Governor Ruiz, a prominent PRIista, accountable for the
killing(s) would have upset the burgeoning alliance between the PRI and the PAN
to ratify Calderon's legislative agenda, the most pertinent item of which was
"energy reform" i.e. the privatization of PEMEX.

Embassy inaction re Brad Wills' murder followed the same logic. As U.S.
ambassador, Bush crony Tony Garza is charged with representing U.S. interests in
Mexico and Washington's interest in opening up Mexican oil to U.S.
transnationals far outweighs its interest in bringing the killers of a freelance
anarchist reporter to justice. The U.S. has long contemplated a North American
Energy Alliance that would guarantee access to Mexican and Canadian reserves.

To this end, Washington has played an active role in facilitating the impending
privatization of Petrolios Mexicanos. Over the past months, U.S. transnationals
and their associates in government have orchestrated an extraordinary campaign
to hoodwink Mexicans into swallowing the lie that PEMEX is hopelessly broken and
must be opened to private capital forthwith for the salvation of the Fatherland.

Last July, ex-Federal Reserve czar Alan Greenspan was beamed into Mexico for a
teleconference with the nation's most exalted business council to deliver an
ultimatum: if PEMEX was not fixed quickly, the country faced fiscal crisis.
Indeed, the petroleum giant (the 11th largest on the planet) generates 40% of
Mexico's total budget and 100% of a social budget that keeps 70,000,000 Mexicans
w ho live in and around the poverty line, in relative quiescence. By "fixing"
PEMEX, Greenspan meant privatizing it.

It should be noted that Alan Greenspan is an expert on fiscal crises - his
monetary policies just helped to tripwire such a crisis in his own country, the
Sub-prime disaster.

The Greenspan game plan was echoed December 13th in a memo issued by the
International Monetary Fund urgently counseling legislation to allow private
capital into PEMEX before the government went broke. Garza's embassy chimed in
the next day, warning of massive capital flight if the Mexican Congress did not
pass Calderon's "energy reform" package. On December 19th, The Economist, which
ironically was founded on the fortune reaped by Anglo oil companies in Mexico
that eventually became British Petroleum, opined that "the obvious solution to
the disaster of PEMEX is to privatize." Finally, the U.S. Department of Energy
delivered the death k nell on January 9th: the lack of investment in PEMEX's
Exploration and Exploitation (PEP) division spelled energy catastrophe - not a
good sign for Washington's North American Energy Alliance strategy. On January
10th, the PRI came on board to back Calderon's "energy reform."

Despite the Jeremiads, the putsch for privatization has lost considerable steam
globally. In fact, a moderate swing to nationalization seems to be in process.
Amidst prognoses of irreparable damage to the Venezuelan economy, Hugo Chavez
renationalized sectors of PDVSA, the state oil company, and ran a 12% surge in
domestic growth in 2007 in spite of it. Bolivia has renationalized natural gas
production and Ecuador is on the brink of doing so. The most successful
renationalization has been in Putin's Russia where Gazoprom and Yukos became
major world players overnight.
According to Mexican strategic resource writer Alfredo Jalife, 32% of the
world's petrol eum supply is in the hands of private transnationals, 20% is
nationalized or in the process of being renationalized, and the rest is held by
mixed state-private corporations.

But despite their exaggerated anguish at an energy meltdown if PEMEX is not
privatized, the doomsayers do have a point: Petrolios Mexicanos is in deep
doo-doo. Daily accidents such as the unquenchable fire that took 21 workers'
lives on a Caribbean oil platform and contaminated surrounding waters last fall,
pipeline bombings by the guerrilla Popular Revolutionary Army, and the failure
to modernize infrastructure - no new refinery has been built in 20 years - is
stark evidence of corporate corrosion.

Despite 100 weak dollar-a-barrel prices (Mexican light crude tops out around $80
USD these days) that generated $2.3 billion in enhanced revenues during the
first ten months of 2007, lack of refining capacity forces PEMEX to shell out $5
billion Yanqui dol lars each year to import 40% of its gasoline needs - which is
to say that for every $1 of the increased revenues PEMEX takes in, two bucks go
out for gas.

Calderon's solution? The so-called "Gasolinazo", the President's gift to the
driving public on January 6th, the Day of the Kings (Mexican Christmas), that
will increase prices at the pump incrementally each month indefinitely.
Increased transportation costs are expected to impact food prices across the
board.

But the bad news doesn't stop there. The big battle over Mexican oil is really
a battle over crumbs. If U.S. Department of Energy calculations are on target,
Mexico only has 12.9 billion barrels in proven reserves, depletion of which
could turn PEMEX into a net importer by 2018 if no new petroleum sources are
uncorked before then - although Mexico is the sixth largest international oil
producer, it has only 1% of the planet's proven reserves.

With the Cantar ell field in the Sound of Campeche, the magnum star of offshore
production that has motored PEMEX since the 1990s, just about tapped out, the
clock is ticking. To exacerbate this doomsday scenario, Mexico is pumping out
what it has left at a record clip to capitalize on the booming barrel price -
PEMEX now produces about 3.2 million barrels daily, fully 1.7 million of which
are sent up the Gulf to the U.S., an export platform that is accelerating
depletion and subsidizing Washington's wars around the world.

Given this bleak picture, most experts concur that the only place PEMEX can go
to drill for new reserves is deep water, five miles down in the Gulf of Mexico.
The only catch is that Petrolios Mexicanos does not have deep water drilling
capacity. That's where Petrobras, as contemplated in the PRI/PAN privatization
scheme, would come in handy.

What exactly constitutes privatization? Auctioning off the corporation from the
top
to the highest bidder or selling it off piece by piece from the bottom? During
35 years of oil boom and bust, PEMEX has systematically dismantled its
Exploration & Exploitation division and handed it over to transnational
subcontractors, emphasizes Autonomous National University researcher John Saxe-
Fernandez who heads up the UNAM's Strategic Resources Institute. At the top of
Saxe-Fernandez's list of prominent subcontractors is Halliburton with 159 PEMEX
contacts since 2000 worth $1.2 billion USD - Halliburton moved into Mexico in
the 1990s during the development of Cantarell when Dick Cheney was CEO.

But subcontracting out choice contracts goes back generations. George Bush pere
partnered with PEMEX director Jorge Serrano (who later went to jail) in Zapata
Offshore, a drilling outfit that operated in the Sound of Campeche in the 1970s.
Today, virtually every major transnational driller has a piece of the Mexican
ac tion.

A recent daily La Jornada investigation by energy reporter Israel Rodriguez
revealed the signing of a series of secret "pre-privatization" covenants to
exploit Mexican fields with Shell (the mysterious "Project Margarita"), Exxon,
Petrobras, Nexen (Canada), and StatsOil (Norway.) The contracts, accessed
through Mexico's Freedom of Information Act, contained clauses whose contents
cannot be divulged for the next five years.

The PRI/PAN energy scam is currently being hatched in the Mexican Senate's
Energy Commission chaired by Francisco Labastida, a former secretary of energy
(as is Calderon) and the PRI's losing presidential candidate in 2000. Those who
have gotten a peek at the details label the energy reform legislation
"privatization lite" with foot-in-the-door measures that will allow for the
"association of private capital" in such areas as pipelines and refineries. The
legislation stops short of amending the Mex ican Constitution's Article 27, which
stipulates that the petroleum belongs to the nation.

Skirting constitutional amendment will deny ammo to AMLO - leftist Andres Manuel
Lopez Obrador, who many believe was swindled out of the presidency in 2006 and
who has emerged as the leader of the fight against privatization. This January,
Lopez Obrador announced formation of a cross-party Movement In Defense of
Petroleum whose battle cry is "Mexico is not for sale!"

The ex-presidential candidate proposes that PEMEX can raise sufficient revenues
without opening itself up to private investment by simply cleaning house - the
corporation has long been riddled with corruption, bribe-taking, kickbacks and
rampant dirty dealing. For decades, the PRI siphoned off millions to finance
its electoral campaigns - in 2000, $110 million USD in PEMEX funds were funneled
through the gangster-ridden petroleum workers union into Labastida's campaign
c offers, the so-called "PEMEXgate" scandal.

AMLO has also long advocated the construction of three new refineries to offset
the escalating cost of importing gasoline which he tags "an absurd situation"
for the world's sixth largest oil producer.

In the opposite corner, Lopez Obrador's archrival Felipe Calderon insists that
opening PEMEX to private capital will somehow make Petrolios Mexicanos "more
Mexican" ("more productive, more competitive, more Mexicano.")

"To hand over our natural resources to foreign powers is an act of treason,"
AMLO responds, quoting the man who expropriated and nationalized Mexico's
petroleum in 1938, President Lazaro Cardenas. Lopez Obrador's defense of
Mexican oil will be a first test for the grassroots base the leftist has been
cultivating since the tainted 2006 election and is sure to frame the next round
of his ongoing bout with Calderon and his allies. AMLO, who in the past has
been able to mobilize millions, is calling for nationwide protests this March
18th, the 70th anniversary of Cardenas's expropriation.

Petroleum is a patriotic fluid here. Expropriation of the oil industry from the
"extranjeros" (foreigners, literally "strangers") was the high point of
revolutionary nationalism in Mexico. But in a globalized world, the coming
battle around the privatization of PEMEX is not just a Mexican matter anymore
and, indeed, has far-reaching implications for the future of neo-liberalism in
the Americas.

Sprawled in the Oaxaca street, the life blood leaking from him, the last thing
Brad Will could have imagined is that in death he would become an accidental
pawn to the transnationals' ambitions to privatize Mexican oil. Tragically, in
the end, that may be Wills' most significant legacy.

******************************
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