Cancún, Mexico

Back in the air-conditioned, aptly named Restaurante California in downtown Cancún, Pepe Zuniga feels a sense of bitter personal betrayal when it comes to Cancún. As a young urban planner, he helped draft the original plans for Cancún in the early 1970s; he even named some of its streets. Now a full-time activist, he leads a network of environmental groups critical of his own creation. "The original Cancún project was sensational," he says. "A pedestrian-based town with ample green spaces, gardens and schools."

But the demand for immediate profit by investors and rampant political corruption guaranteed that Cancún would be a Frankenstein's monster from the outset. In a precursor of the free-trade policies that would be codified two decades later in agreements like NAFTA, the Mexican government made sweeping regulatory and tax concessions to investors in the nascent Cancún project. Later, investment-for-debt swaps--which gave juicy tax breaks to investors--further heated up the Cancún investment market. "In Cancún it never mattered, and it still doesn't matter, who you were or where your money came from," says local historian José Antonio Callejas. Bundles of narcodollars washed through the resort building projects. Mario Villanueva, the state governor until the late 1990s, now doing a prison term after a stint as a fugitive, built a massive political/criminal empire buoyed by the cocaine cartels while in office. That legacy still haunts Cancún. The current mayor's brother, a prominent hotel operator, has also done prison time on money-laundering charges, and experts say Cancún is still a major transit point for the drug trade.

But the biggest problem with Cancún's development is that it was left solely to the whim of the market. "No one ever figured out where or how the workers would live. Better said, no one cared," Zuniga says. When the city sprouted in 1975, it had 5,000 residents, compared with its nearly 700,000 today. As impoverished job hunters poured in and found no infrastructure, they simply set up squatter villages. The dominant Institutional Revolutionary Party (PRI)--which monopolized the government until three years ago--hungry for votes, capitalized on the shantytowns by legalizing them where they stood. As billions of dollars were plowed into the beach resorts, nothing went to build infrastructure for the locals. "Everyone comes here desperate to find a job," says Zuniga. Mix that with the greed of local political bosses and the result is "total urban disaster."

Cancún, he says, is the "mirror that reflects the social crisis" not only of Mexico but of the entire global South. While an average city has nine square meters of green space per inhabitant, Cancún has one and one-fifth square meters. In Jamaica, he notes, the ratio of tourist hotel rooms to industry workers is about 1 to 15. In Cancún it's 1 to 40. Local forest reserves have been sold off to private interests. Shantytowns have been built atop groundwater reserves. And now there are plans to fill in the everglades and replace them with golf courses. "The original idea was to produce a diamond, an expensive diamond that would attract development," Zuniga says. "Instead, we've seen them degrade and degrade this place, cheapening the tourism and squeezing for profits. Cancún used to sell sun, beach and relaxation. Now it sells sex, discos, alcohol and--yes--the beach. My beauty queen that I loved has been turned into a streetwalker."

That "degrading" Zuniga refers to is very much on the minds of many local Cancún businessmen. They, too, are feeling the effects of globalization--and they don't like it. Three-fourths of Cancún's hotel capacity is owned by foreign interests--Americans, Canadians, Italians and, most notable, Spanish hotel chains. And in this industry, it's the Spanish who are making a move to dominate the local market, wringing it dry for profit, driving down prices, cutting costs and squeezing the competition. The Spanish chains have been flooding the market with "all inclusive" deals that offer tourists airfare, a luxury hotel room and all meals and tips, often for $50-$65 a day--half or less what the room alone might fetch on a market peak. This all-inclusive policy has wiped out the income of workers dependent on tips and has led to the closing of a number of restaurants and clubs.

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