MEXICO CITY -- In a last blast of First World high living, Mexicans packed the stands for the Rolling Stones last week.
But the Voodoo Lounge World Tour ran into voodoo economics as the value in dollars of the 195-peso ticket dropped from $57 to $36 because of a spectacular plunge of the Mexican currency.
It took "Los Stones" three decades to come to Mexico. Their fans don't expect to see them again soon.
The year 1994 started turning sour immediately, a year that was supposed to bring Mexico into full economic partnership after approval of the North American Free Trade Agreement. First it was the extraordinary peasant revolt in Chiapas on New Year's Day 1994. Then, a few months later, the ruling party's candidate for president was assassinated.
Now, after a surprise Dec. 20 devaluation, the Mexican currency has headed south. Once beguiled by promises of First World status, the emerging middle class has shelved the Mexican Dream. They anticipate Third World-style hard times.
That 195 peso Stones concert ticket would be priced at 314 pesos if it came to market today. And that's the least of Mexicans' troubles as they face 1995.
Their currency and savings are worth 40 percent less, credit-card and mortgage interest rates are doubling, and livelihoods are threatened by recession. Moreover, the dollar-hungry nation is at the mercy of U.S. investors and politicians.
Mexicans are by turns angry and disillusioned, cynical and resigned.
"We were going to buy a house and get married this year," says Mireya Ventura, 25, a drug laboratory representative, sitting in a park with her fiance, Fernando Romero. "But now our plans have changed. We'll have to wait."
The villain for many is former President Carlos Salinas de Gortari, who opened Mexico to a flood of speculative foreign capital. He is bitterly accused of hiding the peso's weakness until it was too late -- and he was safely out of office and campaigning to head the World Trade Organization.
Left holding the bag of devalued pesos -- and a devalued presidency -- is his successor, President Ernesto Zedillo Ponce de Leon. The 43-year-old technocrat took office seven weeks ago. He is the latest (some say the last) in a 65-year string of leaders from the ruling Institutional Revolutionary Party, known by its Spanish initials as the PRI.
Mr. Zedillo is accused of lying about the peso's stability and then botching the devaluation, setting off what amounted to a run on Mexico's foreign-currency reserves.
Mexican presidents are often assailed as near-dictators, but Mr. Zedillo is criticized as weak -- "The President Who Can't," in the words of one Mexican news weekly.
Trying to seize the initiative, Mr. Zedillo got Mexico's political parties to agree last week to seek "definitive" electoral reform, and he engineered talks with rebels of the Zapatista National Liberation Army in the southern state of Chiapas.
The president's political performance this year will affect Mexico's prospects for economic recovery, as foreign investors decide whether the nation of 90 million on the U.S. southern flank is stable enough for investment.
Mexico's post-devaluation minimum wage amounts to $3 a day -- less than the cost of a McDonald's Happy Meal in the trendy Zona Rosa.
The streets of the smog-bound capital teem with vendors -- so-called "micro-impresarios" -- living barely off the lean cityscape. They form part of the 45 percent of Mexicans who now earn the equivalent of less than $40 a month.
"La crisis" will make their hard lives even harder as growth nears a standstill or the economy shrinks. Wage increases are pegged at 7 percent for 1995 while government projections -- widely considered rose-colored -- are of 19 percent inflation. Prices in Mexico City markets were up 9 percent on average in the past month alone, one survey shows.
The poor have the least, but the once upwardly mobile middle class -- about 15 percent of Mexican workers -- stands to lose the most in 1995.
They are people like Irma Garcia, 49, a federal worker and single parent. She moved into a management position two years ago at about $1,600 a month, enough to support daughter Susana, 20, and son Max, 18. The higher salary qualified Mrs. Garcia for a mortgage on a three-bedroom condominium, and she bought a 1994 Mexican-made Volkswagen Beetle.
But now the government is slashing the budget, and Mrs. Garcia has been bumped down to a job that pays far less -- $240 a month.
The days of buying frozen Chinese dinners at the Price Club or picking up hamburgers at the Burger Boy are over.
She figures the family will eat meat once a week. She also fears the bank will at least double the 28 percent rate on her adjustable, 10-year mortgage. The notice is due any day.
Mrs. Garcia's monthly house payment alone will be at least twice her salary. "They'd have to stretch my mortgage out for 50 years for me to pay," she says. "I'm at the point of pulling my children out of school and putting them to work."
Mrs. Garcia is angry. She believes that Mexico's Ivy League-educated political elite has sold the country out to the gringos.
"They're all from Harvard and Yale. Do they teach them to steal up there or what?" she demands. "They made us believe that everything was going fine. And we fell right into the trap.
"One of these days I'm going to go out and protest," Mrs. Garcia says. "We're like the Popocatepetl [the snow-covered volcano that overlooks the capital] -- calm, calm, calm, and then suddenly it erupts."
When "las senoras de Las Lomas" marched on Los Pinos, the presidential compound, it was clear the crisis had reached Mexicans accustomed to comfortable lives.
Las Lomas is a posh Mexico City neighborhood of spacious houses hidden behind walls topped with jagged shards of glass encrusted in concrete.
Many of "las senoras" are the wives of entrepreneurs and factory owners. They have expensive haircuts, fine clothes and good educations -- and they are used to getting their way.
Now they are acquiring political instincts. When they first marched on Los Pinos, their maids carried many of the signs and banners. The press ridiculed them. Last Thursday they left their servants at home.
"My father was a diplomat, and I grew up in the States, and I know we have the right as women to do this," says Marcela de Sarro, whose husband is an automobile dealer.
"We feel we have been deceived. The government has not spoken the truth. My husband has had to lay off 40 percent of his work force. What are those people going to do?" she asks.
Carmen Romano de Hevia, a leader, laid out goals as the women sat around her in the grass of Chapultepec Park: Truth in government; democracy in Mexico; peaceful solutions to the conflicts in Chiapas and elsewhere; a 20 percent cut in government spending, and full investigations of political assassinations, including the murder last year of the PRI's presidential candidate, Luis Donaldo Colosio.
"Viva Mexico!" several women cried.
President Zedillo at first blamed the Dec. 20 peso devaluation on investor nervousness about renewed Zapatista raids in Chiapas. (The ski-masked guerrilla army launched their Indian rights and pro-democracy rebellion on New Year's Day 1994; a truce is now in effect.)
But it became clear that Mr. Zedillo was forced to devalue because Mexico did not have the cash reserves to pay off $29 billion in dollar-indexed Mexican bonds (including $17 billion held LTC abroad) coming due in 1995.
Mexico also ran up a $14 billion trade deficit by importing more than it could afford. Mexico gambled and lost by financing long-term growth with short-term debt.
The Zapatista assaults in Chiapas and later the assassination of Mr. Colosio created anxiety.
U.S. interest rates rose, short-term dollars dried up. The rewards of investing in Mexico didn't seem worth the risk.
However, the Mexican government kept spending. The PRI's hold on Mexico was at stake in the August presidential election.
Mr. Zedillo, a nasal-voiced man with no electoral experience who succeeded the charismatic Mr. Colosio as the PRI's candidate, needed the help that party-government spending could provide. He got the help and won in the August election.
The president took office Dec. 1. On Dec. 20, Mexico devalued the peso by 13 percent in one day, socking foreign investors with big losses.
The peso dropped steadily until the Clinton administration pledged Jan. 12 to guarantee loans of up to $40 billion to prop up the Mexican currency. It has yet to stabilize because of fears that Congress will scuttle the loan guarantees.
"We learned that you can bring money in and out as fast as pushing a button on a computer," said Alejandro Elizondo-Zuckermann, vice president of the Mexican Investment Board. "We're completely linked to the world. It's hard to play in the big leagues."
To entice jittery investors, Mexico has tripled rates on 28-day treasury bills to about 40 percent. Credit-card and mortgage interest are tied to that rate.
At the same time, soaring Mexican interest rates and lack of credit are likely to stifle growth, eliminate jobs and lead more Mexicans to migrate illegally to the U.S. in search of work that pays in dollars.
Mr. Zedillo starts his six-year term in a deep hole. Only 32 percent of Mexico City residents trust him even somewhat, according to a recent poll (which still left him ahead of Mr. Salinas and the Mexican police).
A bread-and-water diet of austerity for Mexican workers will be unpopular. Plans to raise $12 billion by selling state assets to foreigners will touch nationalistic nerves, particularly if the national oil monopoly is targeted.
Democracy "is the only thing the government has to offer to the population," said Primitivo Rodriguez, a political analyst. "Salinas was the last Mexican emperor."
While television still toes the party line, newspapers are increasingly outspoken and informative.
Modernizing the economy was Mr. Salinas' forte. Opening up the political system -- a system where vote fraud, corruption, strong-arm tactics and even torture have been standard practice -- is Mr. Zedillo's declared goal.
Mr. Zedillo's democratic bona fides and presidential power will soon be put to the test -- mainly by members of his own party. Street protests turned violent last week in Tabasco state. PRI members there fear Mr. Zedillo will oust the PRI governor, who is accused of winning through fraud.
Jalisco, a key state whose capital is Guadalajara, Mexico's second city, holds elections Feb. 12. The conservative National Action Party is heavily favored to win -- unless local PRI members rig the vote.
It's not clear what combination of economic hardship and political discontent would prod large numbers of Mexicans to challenge the ruling party. Mexicans have put up with a lot over the past two decades while their peso plunged from 12.5 to the dollar in 1976 to the equivalent of 5,500 today.