Over the weekend, Mexico’s Internal Revenue Service (SAT) rescinded tax permits for more than 100 NGOs, terminating their ability to receive donations and qualify for tax exemptions. Many have a path to restoring their NGO status, but around a dozen were liquidated outright for failing to comply with fiscal rules. These moves form part of a broad crackdown on waste and foreign interference in Mexico by the ruling left-wing Morena party under President Claudia Sheinbaum and her predecessor Andrés Manuel López Obrador (AMLO).
The Mexican opposition and its allies in the international press have decried these actions as proof of the country’s alleged “democratic backsliding.” In reality, opposition-aligned NGOs like Mexicanos Contra La Corrupción y la Impunidad (MCCI) form part of an artificial civil society complex that was funded, in part, by the now defunct USAID. Upon assuming office in 2018, one of AMLO’s first initiatives was to restore state control over functions that previous governments had devolved to NGOs and private companies. His administration slashed over $300 million of state support for NGOs and reclassified all contractors as state employees, effectively ending their role in government.
Since 2013, Mexico’s Anti-Money Laundering Statute has required NGOs that receive more than $7,000 in donations to reveal the identities of individual donors; those that receive over $15,000 must report individual transactions to authorities. These restrictions were geared towards combating organized crime amid the country’s ongoing drug war. Before Morena came to power, the country’s tax authority exercised loose oversight of foreign funding for NGOs, much as it allowed corporations and the wealthy to skirt their tax obligations.
AMLO’s and Sheinbaum’s crackdowns on tax evasion and strict enforcement of NGO regulations have prompted figures like MCCI founder Claudio X. González to accuse Morena of running a “narcodictatorship.” This claim has been picked up north of the border by Republicans and many liberals, despite the fact that the Washington-aligned PRI and PAN governments that preceded Morena are known to have had deep cartel ties. But the average Mexican will tell you that the cartels are only one powerful interest group exerting a corrupting influence on the nation’s politics, and foreign-backed NGOs are another.
Much of the funding for entities like MCCI ultimately traced back to donations from USAID and the libertarian Atlas Network. All told, foreign financing of NGOs rose 56 percent during AMLO’s presidency to over half a billion dollars, more than offsetting his cuts to state funding. Sheinbaum is now following López Obrador’s example by ensuring that NGOs comply with pertinent regulations.
Sheinbaum has been less openly antagonistic to international progressivism than her predecessor, whose heresies on everything from climate change to gender norms attracted the ire of identitarian leftists. In contrast, progressives abroad are entranced by Mexico’s first female and climate scientist president, who boasts a roughly 70 percent approval rating at home. But they might have been surprised had they noticed that the Mexican leader celebrated the virtual dismantling of USAID by Elon Musk’s DOGE.
Sheinbaum’s government is also quietly expanding fracking in tandem with renewables while overseeing a rail renaissance over the opposition of green NGOs and activist groups. She and her security minister, Omar García Harfuch, have also undertaken arguably the most aggressive offensive against organized crime in the country’s history. On February 22, Mexican special forces executed CJNG cartel kingpin Nemesio Oseguera Cervantes, alias “El Mencho,” and this month, authorities killed eleven members of the Sinaloa cartel in Culiacán. These accomplishments would not have been possible were it not for Morena’s decoupling from NGO-funded professional-class elites and crackdowns on foreign meddling.
“The Democratic Party is deeply enmeshed with the NGO-industrial complex”
In contrast, the progressive wing of the Democratic Party is deeply enmeshed with the NGO-industrial complex—hence the shock and horror expressed over the dismantling of USAID. The result is the outsourcing of governance to unaccountable, parasitic NGOs that function as a jobs program for college-educated professionals while offering little to the working-class voters the party claims to represent. The worst thing Zohran Mamdani could do as New York mayor is follow the example of other progressive enclaves and spin grocery stores administered by NGOs as “state-run.” Those who seek to reorient the party in a populist direction should learn from AMLO and Sheinbaum by cutting off “the groups” and scrutinizing those that receive foreign funding.