Immigration, economy top Fox's U.S. agenda

                   By Laurie Goering
                   Tribune foreign correspondent
 
                   MEXICO CITY -- If President Vicente Fox has his way, migration policy
                   with the United States is about to change fundamentally.

                   Fox sees a future with an open border, where Mexicans are free to come to
                   the U.S. to seek jobs but do not stay, instead crossing freely back to Mexico
                   with nest eggs to start their own businesses.

                   As part of that vision, he does not support an amnesty that would give more
                   than 3 million Mexicans illegally in the U.S. the opportunity to become
                   American citizens.

                   In high-level immigration meetings under way between the U.S. and Mexico,
                   "We're not talking about amnesty," Fox said in an interview Friday at Los
                   Pinos, Mexico's White House. "What we're looking for are the best ways and
                   means to change what was considered a problem in the past into an
                   opportunity" for both countries.

                   That may not be welcome news for Chicago's huge Mexican community, but
                   when Fox makes his first visit to Chicago as president Sunday and Monday,
                   he'll be carrying other good news--including plans to push for an absentee
                   ballot for Mexicans living abroad.

                   "I am going to make sure that migrants and [countrymen] and Mexicans in the
                   United States have a right to exercise their vote in the next [Mexican]
                   presidential election," Fox said. "This is a commitment I've had since the
                   campaign, and I'm more than willing to comply with it. We will push forward."

                   Since Fox took office seven months ago, long-strained U.S.-Mexican
                   relations have taken a remarkable turn for the better.

                   The two nations are working together to rewrite migration policy to curb
                   border deaths, stem illegal immigration and better protect Mexicans already in
                   the United States. Intelligence information on drug trafficking and other crimes
                   is beginning to cross the border, and police are exploring coordinated efforts.
                   Already strong economic ties are being expanded, and for the first time
                   mutual respect is replacing years of suspicion.

                   "It's been amazing, the level of communication between authorities. We're
                   constantly on the phone" with U.S. counterparts, said Adolfo Aguilar Zinser,
                   Mexico's national security adviser, whose staff members chat regularly with
                   U.S. Atty. Gen. John Ashcroft.

                   "It's a remarkable change in a relationship that before was based on distrust,"
                   Aguilar Zinser said. "Before, we kept each other at a distance. Now, so far,
                   so good."

                   On Sunday, Fox arrives in Chicago to try to build on those new ties and to
                   search for ways to keep Mexico's economy rolling as economic indicators in
                   both nations head south.

                   The trip will focus on building trade, investment and political ties. Its
                   importance for both sides of the border is clear: Chicago is now home to the
                   largest Mexican community in the United States outside Los Angeles.

                   During his stay, the Mexican president plans to meet with Mayor Richard
                   Daley, Gov. George Ryan, the chief executives of top Illinois companies and
                   the U.S.-Mexico Chamber of Commerce. Fox also will attend a Sunday
                   evening rally in Chicago's Mexican community, speak at an Economic Club of
                   Chicago lunch and have dinner with University of Chicago officials.

                   Economy doing OK

                   In many ways, Mexico's economy remains healthy. Foreign investment is up
                   50 percent over a year ago as investors flee shaky Argentina and Brazil, and
                   the U.S. slowdown. Interest rates have fallen by half since January, and
                   inflation is pacing that in the United States.

                   But while the nation's economy grew 7 percent last year, the economic
                   slowdown in the United States--Mexico's biggest trade partner--has helped
                   push expectations for growth in Mexico below 2 percent this year. Tax
                   revenue was off nearly 5 percent in May, forcing budget cuts.

                   Still, "Mexico today is the best investment opportunity in the world," Fox said
                   Friday. This year it passed Brazil as Latin America's biggest economy, and
                   today "we have a strong, large economy ready to move and grow as soon as
                   the U.S. economy moves again," he said.

                   Fox, who ended 71 years of rule by Mexico's Institutional Revolutionary
                   Party in a historic vote last July, needs to keep Mexico's economic
                   momentum going in order to pay for the sweeping changes he has promised,
                   from progress against poverty to an all-out war on corruption.

                   He wants to do that by boosting small and medium-size businesses in Mexico
                   and by wooing even greater foreign investment, from large companies and
                   from Mexicans living abroad, who send an estimated $8 billion each year
                   back to their hometowns and families.

                   Fox hopes to promote and expand that flow of cash to Mexico by offering
                   state and federal matching funds for development projects emigrants finance
                   in their cities of origin.

                   "We want that money to be invested in productive projects, in
                   entrepreneurship, in putting together businesses in their communities," Fox
                   said. The idea is to "create the jobs and opportunities they need so that their
                   kids don't have to move to the United States," he said. "That is our
                   responsibility as a government, to create the opportunities that people need
                   here in Mexico."

                   Opposition in Congress

                   Winning fiscal reforms needed to pay for such matching projects will be
                   tough. Mexico's divided Congress has balked at a proposed new 15 percent
                   sales tax on food and medicine--designed to boost Mexico's notoriously low
                   tax collection rate--and has put off any vote on the president's unpopular
                   proposal until September at the earliest.

                   "Fox must feel very frustrated," said Federico Estevez, a political scientist at
                   the Autonomous Technological Institute of Mexico. "He wanted to be a
                   strong president who could get Mexico out of its rut and move it along
                   toward the political, economic and social changes everyone wants."

                   But with the PRI's one-party political stranglehold now broken, Fox finds
                   himself grappling with just the kind of recalcitrant Congress that President
                   Bush sometimes faces and trying to find his way through a messy system of
                   democratic checks and balances, something new and unfamiliar in formerly
                   authoritarian Mexico.

                   "This is what we voted for, a weak president who would have to get out there
                   and convince people to move an inch," Estevez said. "In some ways he's just
                   like George W. Bush and there's not a lot he can do about it."

                   Fox, however, says he is making progress with Congress. He is
                   three-quarters of the way toward an agreement on passing fiscal reforms,
                   including the new taxes, he said, and "getting closer and closer to an
                   agreement."

                   Despite a recent minor corruption scandal, in which Fox's administration was
                   found to have bought $443 towels for the presidential residence, Fox
                   continues to enjoy huge popularity in Mexico. A poll last month by TV
                   Azteca put his support at 69 percent, and 72 percent of those polled said
                   things were better under Fox than under the PRI. Fox's own polls show him
                   with 80 percent support.

                   But popularity has not been enough to solve Mexico's many pressing
                   problems.

                   Nearly 40 percent of Mexicans live in poverty, which Aguilar Zinser said is
                   the nation's top national security challenge--and the driving force behind illegal
                   migration that has pushed the population of Mexican immigrants in the U.S. to
                   8.5 million, including 3 million illegal border crossers.

                   During his campaign, Fox promised to work to build Mexico's economy and
                   gradually diminish the gap in wages and lifestyles between Mexico and the
                   United States, the prerequisite for moving to an open border, his dream.

                   But since taking office he also has pressured the Bush administration to
                   accept more legal immigrants, allow a guest worker program and create
                   broad new rights for Mexican workers in the United States.

                   Details on a new migration agreement aren't expected to emerge until
                   September, but Bush has been thinking about the issue as well. Last week he
                   promised to reform the U.S. Immigration and Naturalization Service to
                   improve treatment of immigrants and simplify procedures.

                   Bush called such better service "the mark of a confident and successful
                   nation" and said "people who strive to make America their home should be
                   received [in a more dignified] spirit by representatives of our government."

                   Even though Bush is making these proposals, most analysts think that
                   Mexico, for the first time in decades, is driving U.S.-Mexican policy. Bush
                   and Fox, both ranchers and former governors, share a warm relationship, but
                   it is Fox who is making most of the recommendations.

                   `No longer on defensive'

                   "We've become a different kind of player with the United States," Estevez
                   said. "It's clear we're no longer on the defensive, that things have changed
                   180 degrees. Foreign policy has become the most noticeable example of
                   positive change since Fox's election."

                   Fox's visit to Chicago is in some ways nothing new. Mexico's last two
                   presidents also passed through the city, both to maintain ties with Mexicans
                   abroad and to court their growing political clout, not just in the United States
                   but perhaps eventually in Mexico.

                   During his campaign, which included stops in Chicago, Fox promised for the
                   first time to give Mexicans living abroad the right to an absentee ballot, which
                   would allow them to vote in Mexican elections without having to return home.

                   Emigrants, who traditionally have opposed the PRI, are widely believed to
                   have made substantial illegal contributions last year to Fox's campaign and
                   that of Cuauhtemoc Cardenas, another opposition presidential candidate.
                   Emigrants' votes would be even more valuable.

                   For now, Fox will work on trying to round up a little more cash to keep
                   Mexico's finances on an even keel. But he, like Aguilar Zinser, is confident
                   that fundamental change will continue in Mexico, even if the economy
                   continues to shuffle rather than race.

                   "Hard times are good times to do things you wouldn't have done otherwise,"
                   Aguilar Zinser said. "Adversity forces you to be more creative."