AMLO and behold: Mexico’s president tries to tackle corruption

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Hello and welcome to the Intelligence on Economists Radio. I'm your host Edward McBride, standing in for Jason Palmer. Every weekday we provide a fresh perspective on the events shaping your world. Economists typically ponder big knotty problems with no simple solutions, such as working out why recessions occur. But what if they could give policymakers clear answers to precise questions? This year's Nobel laureates in economics say that they can. And caterpillars are not everyone's idea of a tasty meal. But in Congo they are considered a delicacy and widely sold in markets. Could these wriggly treats provide a planet saving lesson to the rest of the world? But first, It's a year since Andres Manuel Lopez Obrador, known as Amlo, was inaugurated as president of Mexico. He won a landslide victory, taking 53% of the vote and defeating his nearest rival by 30 percentage points. Voters chose Amlo out of desperation, having rejected him as president twice before. They were angered by corruption, violence and poverty. Graft was rife, the murder rate the highest on record in amlo. Many Mexicans saw a possible savior a year on. His approval ratings remain high and yet there is little evidence of the reform people had been hoping for.

His supporters believe he has a kind of incorruptibility or almost incorruptible infallibility that Might resemble some kind of religious leader.

Richard Ensor is the Economist's Mexico correspondent.

He gets this from working extremely long hours, from flying around the country on commercial jets with the people, as he might say, and for cutting his salary and for being regarded as someone unlike other presidents who would never ever steal money. He stands up for what he describes as a forgotten poor that have been betrayed by a mafia of power that has centralized and controlled all of the economic and political might in the country and used for a very select few.

And so that rhetoric, that anti corruption rhetoric, the man of the people stuff, that helped to carry him to the presidency, right?

Absolutely. And people have been expecting to see a great deal of change. And these expectations are still with him one year into office. In fact, rarely and especially rarely in Latin America, let alone the rest of the world. An approval rating of 60%. There are no daily protests in the street against his rule. People for now seem to be very much optimistic that this is going to be a successful presidency that will represent a break with an unhappy past.

So how has Amlo's presidency gone so far? Has he delivered on all his talk about fighting corruption?

There has been a kind of flurry of activity that from afar off looks like a kind of crackdown against corruption past and present. That includes the arrest of one of the cabinet secretaries of the previous president, Enrique Pena Nieto, who has been accused of stealing a quarter billion dollars.

But. So you sound a little bit skeptical that this is a genuine fight, or am I misreading you?

Well, that's exactly right. And to start with, what a lot of Mexicans will tell you is that this is a kind of national pastime. A president coming in, doing nothing to change the institutions that catch, deter or prevents corruption, but going after one kind of emblematic villain of the previous administration, locking them up and saying that all is well, corruption has drawn to a close and everything is fine. But without changing those institutions, usually it's revealed later in their presidency that this is not the case.

Okay, so what has happened institutionally? How has Amlo been doing there? Is he better than the previous government in that respect?

Even as corruption hit a kind of historic high by modern standards and the previous government, everything was very pessimistic on that perspective. There was actually a great deal of momentum among civil society advocates to fight for and win a new anti corruption system that involved the public declaration of assets by politicians for the first time in a systematic way. It involved the creation of an anti corruption commissioner who was a citizen, and the reform of the attorney General's post. And these things held a lot of promise for the years to come. And now that we see an anti corruption president start to take office, you might think this is perfectly laying the groundwork for a kind of anti corruption revolution. However, what we're seeing is not only that the President does not like or trust civil society groups that are very often funded by rich people that he doesn't like and that steal the limelight from him, he thinks that the only appropriate vessel through which this anti corruption fight can flow is through, through his own aura and his own sort of personal example given to the nation. And so he doesn't have very much time for these kinds of institutions.

So how have anti corruption campaigners taken all of this? I mean, you know, he may be personalizing the campaign, but they must be thrilled that there's someone out there doing battle with corruption, right?

On the contrary, they are extraordinarily gloomy. They feel that their philosophy on corruption, that it is a problem caused by institutions and incentives, is being totally abandoned in favor of a worldview about corruption that says it's to do with personal morality and the shining examples of leaders. And they don't believe in that path to fix corruption. And the President very much does not believe in them. So, for example, the NGO Mexicans Against Corruption and Impunity is constantly referred to by the President in his daily press conferences as Mexicans in favor of of corruption and impunity. And you can imagine how this kind of vilification makes them feel.

There seems to be a huge irony here that the previous administration, which was regarded as very corrupt, actually put in place some of the sort of institutional changes that might help fight corruption. And this new government, it's the reverse. Even though it's seen as very clean, it's not actually really helping in the corruption fight. Is that too harsh an assessment?

No, that's very much the case. The previous government was so weak that these civil society campaigns actually had enough power to get through the Senate, and they were so weakened by corruption, they needed to look like they were doing something. So civil society had a lot of success. This government, as we discussed, remains extraordinarily popular and extraordinarily powerful. And this at the moment is a time of real gloom for the anti corruption movement in Mexico.

It sounds the sort of scenes you describe would naturally call into questions AMLO's real dedication to the fight against corruption. Why aren't voters getting misgivings?

Well, in many ways, that's kind of the flip side of personalizing your government. And portraying yourself as the grand benefactor to the Mexican people of all that is good in Mexico, which is that when your government has failings and when there are concerns about how your government was run, the voters will mentally think, that's the government. That's not necessarily my president. You will see that voters judge this president 30 percentage points more favorably than they judge the performance of his own administration, which tells you that there is a kind of cult of personality that is doing a lot of the heavy lifting at the moment. Whether eventually some of these problems and institutional trials that we are seeing start to catch up with him. This remains unclear.

Richard, thank you very much for your time.

Thanks. It's been a pleasure.

Nobel Prizes are usually given in recognition of ideas that are more or less guaranteed a legacy. But occasionally they give rise to controversy by celebrating work that is still being debated and argued over. And one of this year's awards has certainly done that, garnering as much criticism as praise.

So in October, the Nobel committee gave the 2019 prize in economics to three academics, PG Banerjee and Esther Duflo, who are from MIT, and Michael Kramer from Harvard.

Ryan Avent writes about economics for the Economist.

The award was given for the ways that these economists have studied how poverty works and explored ways to reduce it. And in particular, this technique that they developed to answer these questions is called a randomized controlled trial.

So I understand how randomized controlled trials work in medicine. When you're testing out whether a new remedy is effective or not. How do they work in economics?

Well, it's not actually so different from the way that it works in medicine. Essentially, you have some sort of research question that you're interested in answering, such as, how does a particular policy affect something else in the community that you want to know about? And what you do is you go and you have a group of participants and you randomly sort them into a control group which will not receive any treatment at all. And then one or more sort of study groups that receive the treatment that you're interested in learning about. And because these groups are randomly selected, there shouldn't be any other factor affecting the outcomes other than the treatment that you're studying. So you get a nice clean look at what the effect of this particular policy intervention ought to be.

Okay, that makes sense. Can you give us an example from the prize recipient's work?

A really good example, actually, is one that Esther Duflo mentioned to us in the Economist Money Talks podcast, which she did very shortly after she won the award. And this was an experiment that was done In India, where the population is generally in favor of immunization against diseases, but practically speaking, the use of these vaccines is quite low. Only about 5% take up the vaccine when offered to them. And so there was a study done to see, you know, can we improve this number. And basically they got a sample of 120 villages in India. Half of those villages are sort of randomly sorted into a control group that doesn't get any different treatment than what's already happening. And then of the remaining 60 villages, there's half which are sort of given more regular access to vaccine supply immunization services. Groups come once a month and make these immunizations freely available to all. And then the other half gets that supply intervention. But in addition, they're offered small incentives to get kids in the communities immunized. Things like, you know, every time a child is, receives a shot, there's a kilogram of lentils that are given to the family, things like that. And so they're able to see very clearly what these interventions do to raise uptake rates. And the responses are pretty impressive that if you just make the supply more readily available through these monthly visits, take up rates go from 5% to 12%. And then if you have both the intervention with the supply and also the incentives given for each shot, it goes up to 37%. So that gives you kind of a nice look at how this kind of setup gives you, you know, a really rigorous result on what these interventions do.

So it sounds like that would be a good thing. Why is it coming in for so much criticism?

Well, you know, there are a few different sort of types of criticism that these things have faced. I think one is just a reaction to the fact that there's been so much enthusiasm about randomized controlled trials that people hold them up as kind of the gold standard of research. It's, you know, it's had kind of a wow moment and there's a lot of evangelists for them and there's a lot of other researchers out there saying, no, look, these things are useful. They're, they're particularly useful in some contexts. But let's not sleep on all the other techniques that we've developed that work better in other contexts. You know, another criticism is that there are some ethical concerns in some cases with the use of these experiments. And one is that there tends to be a pretty big kind of power imbalance between the experimenters, who are largely well educated people from high income countries, often white, and they're conducting these experiments on much poorer people in developing economies. Many of whom are not white. And so there's an issue there. And sort of, to what extent is there really consent involved? To what extent are people taking advantage of countries that have sort of lax oversight and insufficient other options available to them, that sort of thing? And then I think the other thing is that a lot of these experiments, you know, part of what you're doing is testing a treatment that you think is going to help people. But as part of the experiment, you're denying that to a group of the population. And so if you're studying whether giving students a medicine to make them healthier improves their test scores, then what you're doing is giving that medicine to, you know, half of your experimental group and not giving it to the others who clearly would benefit from the medicine. And so is that the right thing to do? Or should we not just go ahead and give the medicine to everyone?

The criticisms you've outlined so far seem aimed at the nitty gritty of randomized controlled trials, specific ways in which they might be limited or could be improved. But what about the bigger picture? The Nobel Prize was given, after all, in recognition of the three economists work to alleviate poverty worldwide. What do economists view about that decision?

A lot of the people who have sort of developed randomized control trials and sort of spoken on their behalf, they say that this is a way to understand how to move poor countries from being poor to being rich. And when you kind of step back and look at how countries in the past have become rich, it's just not clear that that's the case. When countries develop, it's a process that involves kind of all aspects of society, from institutions to government to markets to culture. And it occurs because of these sort of sweeping pivot points in history, like China deciding to liberalize. And that's really just not something you can test with a randomized controlled trial. It's just not the case that declines in poverty over the last 20 years have occurred because, you know, people learn how to better administer deworming medicine or things of that nature. And so I think there's a. There's a real question as to whether these tools are able to provide the knowledge that. That its supporters say they're able to provide.

What does all this criticism and debate tell us about economics more generally? Is it a sign of a wider split?

For most of the 20th century, I think a lot of the big names in economics had huge ambitions for the field. They thought that they were going to be the masters of the universe, like physicists, able to kind of describe how these vast systems work with a high degree of sort of precision. And I think what we're realizing is that that's maybe not possible. That, you know, as much as people might want to develop grand theories of development economics and help these countries escape from poor country status, you know, the reason these randomized control trials are able to be done and do good work in the first place is because so many countries are still poor, because economics hasn't sorted out what it is that allows a country to make the transition from poor country status to rich country status. So it kind of illustrates sort of a real crisis at the heart of economics in terms of what this particular branch of social science is able to achieve some things certainly, but the goals that it's set for itself over the past 150 years, I'm not sure.

Ryan Avent, thank you very much.

Thank you, Ed.

It's good to talk to you.

To hear the Economist's interview with all three of this year's Nobel Laureates in Economics Search for money talks wherever you're listening to this. The episode aired on 15th October and was called a Nobel endeavor. Livestock farming is bad news for climate change. The United nations estimates that raising animals for meat, eggs and milk generates almost 15% of the world's greenhouse gas emissions. But there are more environmentally friendly ways of getting protein into people's diets. In Congo, they've had a solution for generations.

So I went to a busy market in Goma, which is a city in eastern Congo, to speak to women in the bug business.

Olivia Ackland writes about Congo for the Economist.

There are various women who sell caterpillars and grasshoppers at this market. There was an old woman who was sitting cross legged and it was almost as if she was shelling beans, but she was plucking the wings off live grasshoppers and sort of throwing their wriggling bodies into buckets. There was another woman who was standing in front of this stall piled high with boiled and salted caterpillars. So I spoke to one of the grasshopper sellers and she told me that she'd collected the grasshoppers herself that morning at the airport. So the airport in Goma is one of the few places that has a constant electricity supply. And so throughout grasshopper season, dozens of people gather there each morning because the lights that light up the Runway attract swarms of grasshoppers. And so this woman, she said that she goes there with a bucket of water and she puts the bucket of water under one of the lights and the grasshoppers come and they fall into the water, and then once she's sort of caught them, she picks them out of the water and stuffs them into plastic bottles and turns up in the market later that day to sell them.

Did she say whether she got good money from selling bugs?

Yes. So I asked the grasshopper seller if the grasshopper business was lucrative, and she said, yes, it was a good business. A small pile of grasshoppers fetches around 60 cent, which is a lot of money in Congo, where most people live on less than $2 a day.

Did you try them? How did they taste?

So they tasted surprisingly good. I have to admit I didn't try the grasshoppers, but I did sample the caterpillars and they're cooked over a charcoal stove for hours. So they're boiled until all the water boils off and then they're sorted. And they were sort of crunchy and smoky tasting and actually not bad at all.

So how popular are caterpillars and grasshoppers and all these other bugs in Congo?

So in Congo, people have been eating bugs for centuries, the most popular ones being caterpillars, grasshoppers and ants. There was a study that showed that households in Kinshasa, the capital, consume on average 300 grams of caterpillars a week, which is around 80 caterpillars. They're packed with vitamins and nutrients, for example, potassium, calcium and magnesium. And they're also incredibly rich in protein. So a caterpillar would be richer in protein than the same amount of beef or fish. And they're also packed with calories. So a hefty handful of caterpillars would have around 500 calories, which is more than a cheeseburger. This is incredibly useful in a country that has very high rates of malnutrition. So bugs, and specifically caterpillars, are an extremely useful food source.

So presumably it's easier to farm caterpillars and grasshoppers than it is to farm cows.

Yeah, so exactly. So industrial farming is very bad for the environment. The amount of methane that the cows give off and the amount of space they take up and also planting all of the feed, whereas bugs take up, obviously very little space. And being cold blooded, they're incredibly efficient in converting food into protein. So crickets, for example, need 12 times less food than a cow would to produce the same amount of protein. And they can also be fed on kitchen waste like rotten fruit and vegetables.

This sounds ideal. Are there any problems?

The problem in Congo with the bug business is that anybody can wander into the forest or indeed to the airport, and gather caterpillars, ants and grasshoppers. The problem is that some are poisonous. So if you're not careful and you collect the wrong types of caterpillar, for example, then you can poison your customers. I spoke to Leonie, a caterpillar hunter, who told me that her family have been hunting caterpillars for generations in the forest, and her children do the same. It's quite painful gathering them because their spikes sting your hand. And so her hand sort of swells to twice its normal size. After a day of gathering caterpillars, she has to wash her hands in salt water.

So do you think the idea of eating bugs could spread to other countries, other cultures, or do you think the gross factor will prevent that?

Yeah, so I think a lot of it is very sort of cultural that we find it so disgusting to eat bugs. I mean, if you don't like the look of the bug, which is often the problem, you can grind them up. So, for example, here people grind caterpillars onto food for children, and it's particularly good for malnourished children. So I think, yeah, I think possibly the way to introduce bugs more regularly into a Western diet would be to disguise them that way.

Olivia, thank you very much.

Thank you very much for having me on the show.

That's all from us on the Intelligence, but we'd like to know more about you and what you think of the show. Do us a favor and head over to economist.com podsurvey see you back here on Monday.

Sam.