I was wondering how long it would take, but the PAN and its ilk have been salivating at the possibility of privatizing Mexico’s state owned oil industry for decades, and now they are trying to make public theft of state assets a reality.

State ownership of the oil industry is a core value of the Mexcan body politic, so much so that there is a national holiday to commemorate the nationalization of the industry. It is considered to be a pillar of national sovreignty.

The reason that PAN loves the idea of privatization is because it will provide the opportunity to generate huge salaries and consulting commissions to the pale skinned Mexican elites who went to university at places like Harvard and Brown.

The facts are simple:

• Mexican oil production is dropping.
• Mexican oil revenues are at an all time high because of high oil prices.
• It cost nothing to leave unexplored oil where it is right now.
• There is no need to rely on big oil for the technical expertise to get at that oil.

When the Oil industry downsized and consolidated in the 1980s and 1990s, thousands of petroleum engineers and the like were without jobs, and many of them found positions with the oil services industry, which now arguably more technically capable than the big oil.

If they want these fields developed, the Mexican government could contract with companies with Halliburton and Slumberger^*, and get the job done without signing over future earnings. What’s more they would get more local employment out of it, because big oil tends to employ lots of expats to get the job done.

The claims that Pemex “lacks the money and expertise” to get this done are driven by a desire among Mexican conservatives to sell $100 of oil for $1 today, because them and theirs will get an additional 50¢ in sweetheart deals.

Pemex does have problems, but these can be fixed.

^*Full disclosure, one of my step mom’s life long friends is one of those Slumbergers.