Published by Minyanville

“Probably Mexico’s most powerful woman” is how the Associated Press describes Elba Esther Gordillo, president of Mexico’s teachers’ union and “potential kingmaker in next year’s presidential election.”

The head of Latin America’s biggest union, the 1.5 million member National Union of Education Workers, Gordillo is mired in allegations that she attempted to extort $1.7 million a month from a federal agency.

The accusations come from the head of Mexico’s social security system for government workers, Miguel Angel Yunes. He claims that Gordillo—known as La Maestra, or the teacher—met him at a San Diego hotel in 2007 and demanded the figure to finance a political party.

The Economist, under the headline "An expensive handbag fight," yesterday described Gordillo as one of the country’s most extraordinary political creations, having accumulated a fortune that is thought to include mansions across the world and a private jet.

Her political power is well-known in Mexico. She confirmed recently that before current Mexican President Felipe Calderón came to power in 2006, she had made a “political arrangement” with him in which she would back his candidacy in return for his support in appointing her allies in government posts.

Gordillo denies Yunes’ allegations, calling them “rash, frivolous and slanderous.”

Reuters’ Anahi Rama was scathing of Gordillo. “Mexico's ambitions to become a top world economy are being held back by a corrupt public education system controlled by (Gordillo), who politicians fear to cross,” she wrote, before relaying that one political analyst described the 66-year-old as the “Darth Vader of Mexico,” while others call her “Jimmy Hoffa in a dress.”

French Finance Minister Beats Mexican Candidate for IMF Presidency

As the entire world expected, French finance minister Christine Lagarde was named head of the IMF, beating Mexico’s Agustin Carstens. In the end, much of the world—including the emerging markets of China, India, Russia and Brazil that complained so bitterly that they deserved the role—backed Lagarde.

As the news was announced, Mexico’s Carstens hit out at the world’s monetary bodies. “The reality is that these institutions have always asked for transparency from us, they have asked us to adopt democratic principles that they do not enforce themselves,” he told a local radio station, after describing his standing as a “protest vote” at the way industrialized countries handled important issues.

“It's difficult for many member countries to receive, let alone accept, recommendations from the (IMF) if they don't see that the recommendations are made by the best people,” the Mexican central bank governor continued.

It wasn’t all sour grapes, though. “I am sure that Lagarde will be a very capable leader of the institution,” Carstens said. “I hope … the IMF will make meaningful progress in strengthening the governance of the institution, so as to assure its legitimacy, cohesiveness, and ultimately, its effectiveness.”

Lagarde remained diplomatic as well. She downplayed her French connection, saying she does not feel specifically French or even European, but rather a member of the entire community. She went on to address the lack of diversity within the IMF—a victory in kind for Carstens.

Calderón's Party Poised to Lose Control of Mexico

President Calderón may be beginning to worry before elections come around next year. Though he can't run again, his party was battered by the country’s main opposition, the PRI, in a vote in the State of Mexico. The PRI governed Mexico for seven decades until 2000, when Calderón’s PAN party took over. Analysts suspect the PRI has a strong chance of returning to power in 2012.

One major factor is Calderón’s failure in Mexico’s war on drugs. Around 40,000 are thought to have died since December 2006, when Calderón came to power and began to fight the cartels head-on.

In Other Mexican News

The Mexican peso was at a two-month high on Thursday, thanks to employment data from the US—demonstrating once again how intertwined the two countries’ economies are. The peso closed at 11.549 per US dollar on Thursday compared to 11.628 the previous day.

Meanwhile, a Mexican woman was arrested this week as she attempted to smuggle her husband out of jail in a suitcase. One sharp policeman made sure a photo was available to the world.