The Ongoing Populist Revolution In Latin America

THE ONGOING POPULIST REVOLUTION IN LATIN AMERICA ANDRÉ MOMMEN

University of Amsterdam June 2006

TPS/ECPR Policy Network Fourth Transdisciplinary Forum Magdeburg Revolutions: Concepts, Discourses, Practices of Revolutionary Action in Our Time Magdeburg, July 7-9, 2006 Universität Magdeburg Germany ISBN 9072086937

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INTRODUCTION As the turnover of capital increases so history itself speeds up. Geoffrey Kay1

Since the 1980s Latin America is experiencing a still ongoing transition from import-substituting industrialisation and authoritarianism to democracy and social and economic reforms. Keywords as “renovation”, “dynamism” and “democratisation” have been used in connection with “liberalisation” and “privatisation”. Import-substituting strategies were abandoned and replaced by monetary stabilisation programmes promoting export-led growth. The price these Latin American countries paid was high. All experienced debt crises during their shift towards democracy. The irreversible reality of the globalisation process, with intense capital and trade flows obliged these countries to adopt institutional transformations and to open up their markets. At the other hand, neoliberal policy changes fostered the growth of social movements defending and representing the urban poor, the landless peasants, the Indians, and many rural workers threatened by the effects of globalisation. These groups are campaigning for more social protection, human rights and a better stand of living. In Latin America, blue-collar workers constitute a small share of the total work force and the electoral challenges faced by leftist parties are greater than in Europe. To compete effectively, they 1

Geoffrey Kay, Development and Underdevelopment: A Marxist Analysis, London and Basingstoke: Macmillan, 1975, p. 183.

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will have to incorporate the middle classes, the informal workers and new social movements whose interests often conflict with the unionised workers. The traditional means of reconciling such conflicting interests is through populism, an electoral and policy strategy that has not only been discredited, “but is itself arguable inimical to the consolidation of both economic reform and democracy”.2 Latin America is, with the exception of Colombia, becoming more sceptical about the US. Economically, the commodities boom has demonstrated to a host of regional governments that their predecessors set too low a price on the region's natural resources when it allowed them to be exploited by foreign companies. In this paper we shall discuss some aspects of the ongoing revolution in Latin America and the way Latin American populism is changing its own nature after two decades of neoliberal experiments. Recent political changes in Brazil and Bolivia will be studied as cases. Both countries are symbolising important policy shifts. Though in 2002 Brazil elected the metal worker Lula as president, no fundamental break with neoliberalism was consumed. In 2005, Bolivia elected cocalero Evo Morales as president after several years of social upheavals and growing political instability. Morales promised to break with neoliberalism and to initiate socialist reforms with the nationalisation of the oil and gas industry.

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Stephen Haggard and Robert R. Kaufman, The Political Economy of Democratic Transitions, Princeton: Princeton University Press, 1995, p. 361.

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THE “WASHINGTON CONSENSUS” AND GLOBALISATION The broadly accepted “Washington consensus” postulates that economies that have chosen to develop a high degree of integration with the capitalist world economy have grown faster than those that have failed to do so. The problem is that many countries, after having adhered to the “policy fundamentals”, had difficulties in changing their economic policy. Their populations contested the ongoing liberalisation and privatisation schemes. In the Middle East and North Africa, reforms were postponed because of structural obstacles. In the successor states of the Soviet Union, globalisation brought a new logic of interaction between society and the outside world under the aegis of an oil and gas industries reorganized by the Moscow Kremlin. In Latin America, globalisation took the form of regional trading blocs. The United States and Canada formed with Mexico the core of NAFTA, while Argentina and Brazil dominate the southern trade bloc MERCOSUR. In the context of international integration in the Americas and the path towards a free-trade area in the Americas, the impact of the NAFTA on Mexico’s economic and social structure are dramatic. Not only did NAFTA have a considerable impact on the levels of economic integration within North America, but it had a considerable impact on trade orientation for both the US partners, Mexico and Canada. The

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Mexican economy is today irremediably linked to that of the US. Economic liberalisation efforts, especially in the direction of Latin America, hurt most traditional interests of North America’s population. Clinton’s “globalist” view of foreign and economic policy, stressing human rights, peace keeping, and financial liberalisation policies could trust on the serviceoriented middle classes, not on the declining industrial sector with its blue-collar workers. His administration fashioned a new set of economic policies promoting economic growth according to neoliberal prescriptions. At the same moment its neoliberal synthesis appealed to the less advantaged portions of the former New Deal coalition. Therefore, the Clinton administration had to restructure its electoral base and to revise the Democratic Party’s traditional ties with the big unions and the protectionist industrial and agrarian lobbies. The Clinton years can be considered as a decade of neoliberal consolidation, not of a return to a New Deal. The Bush years give the impression that Clinton’s policy mix based on neoliberal economic incentives and job creation for the poor, has received a neoconservative correction based on tax cutting, hug spending deficits and military built up with a return to classic “big stick” imperialism. Economic liberalisation in Latin America is characterized by political instability marked by state strikes and upheavals, repression and corruption. Within the context of high inflation and even hyperinflation during the 1980s, the failure of heterodox monetary stabilisation plans (in particular, the austral and cruzado plans), pressures exercised by multinational institutions for the adoption of market reforms and intensive ideological propaganda promoting the “Washington consensus”. This seems to be even more “necessary” for peripheral economies in need of foreign capital for their economic growth. The transition of import-substituting industrialisation to a free-trade regime has been badly managed in many Latin

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American countries. The road to growth was obstructed by monetary crises and social conflicts. The final collapse of the Argentine economy proved that the IMF-inspired monetarist strategy was wrong. The rise of neopopulist and social movements proved that neoliberal reforms have created a solid base for a newly formed alliance of industrial workers, landless peasants, and the urban poor in the slums. The neoliberal policy regimes became ungovernable, generating pressures to move beyond the “Washington Consensus”. The outcome was the construction of an amended neoliberal policy regime – a neoliberal programme of macroeconomic policies combined with a new anti-poverty social policy and the institutionalisation of a new economic model. Not only the economics of free trade per se but the philosophy of liberalisation as well in a sociopolitical context where nationalism, statism and public redistribution of welfare are rooted in the public value system, have led Latin America further and farther away from the implementation of these values over the years.3 Neoliberal reforms implemented under conditions of “redemocratisation” of the formerly dictatorial and military regimes reinstalled the rule of law and created new possibilities and 3

Liberalisation policies supported by neoclassical growth and trade theories – the neoclassical Heckscher-Ohlin trade models – predict that as the prices of goods and services converge, so will factor prices, including real wages. In the case of Mexico the Heckscher-Ohlin model is not valuable. In the first nine years of NAFTA’s existence 8 million new jobs were created. But the formal sector of the economy has only created 3 million new jobs since NAFTA, forcing people to seek survival strategies in the informal sector. Moreover, 55.3 percent of new jobs do not comply with legal conditions. At the close of 2002, only 36 percent of workers, men and women, benefited from social security. There are 9.4 percent less jobs in the exportmanufacturing sector. Between 1994 and 2002, only 500,000 jobs were created in the manufacturing sector, an average of 62,000 jobs per year. Mexico, the North American Free Trade Agreement (NAFTA): Effects on Human Rights. Violations of Labour Rights, Report, International federation for Human Rights, no. 448/2, April 2006, p. 7.

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frameworks for intermediary groups and structures strengthening “civil society”. The popular classes experienced the brunt of the sweeping structural reforms associated with the neoliberal policy reforms. Subsequent rounds of reforms induced a widespread transfer of property, productive resources, and incomes from the working class and the mass of direct (agricultural) producers to an emerging capitalist class of investors and entrepreneurs having close links with multinational industrial and financial capital. Neoliberal reforms created a flexible labour market and export facilities for multinational firms. The sustained increase in poverty has forced many men and women into informal work, generally carrying out subcontracted low-paid work at home or itinerant. In Mexico, the maquiladora system of production, initially set up in 1965 in order to facilitate the implementation of a subcontracting industry of exportation in the North, is free trade zone of production under a special regime. By 2001, maquilas accounted for 51 percent of total exportations, up from 40 percent in 1992. Today, the system attracts workers from the interior of Mexico who use the maquiladora as a gateway to the US. Multinationals arrived after the NAFTA Treaty was signed and put an end to the previously existing small businesses. The effects of the establishment of maquilas have been family disunity, uncontrolled urban growth, a lack of public and social services and insecurity. The State withdrew and allowed companies to take over social security.4 However, progovernment unionism has been eroding. The Unión Nacional de Trabajadores and the Frente Nacional Méxicano managed to break the monopoly of the Confederación de Trabajadores de México (CTM). Meanwhile, the Mexican Government 4

The 1917 Constitution guaranteed a minimum wage, labour stability and, later on, social security and the right to accommodation. The maquiladora industry also meant impoverishments in the standard of living, wages benefits, and working conditions. Dan La Botz, Mask of Democracy. Labor Suppression in Mexico Today, Boston: South End Press, 1992, pp. 161-183.

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supported more the sindicalismo blanco than the CTM, because it serves the corporate interests. WHAT IS POPULISM? Virtually all studies of populism in Latin America attest to the existence of special bonding between leaders and followers. The usual sources for political history, however, do not penetrate deeply into these bonds, which are essentially psychic phenomena. For example, we know that Latin American populism is highly sensorial yet we cannot measure its impact. Followers experience it emotionally and intimately. For the masses, populism consists of speeches, music, movement, smells, tastes, crowds, excitement, and even intoxication. It sparks anticipation and arouses passions. Populist leaders become addicted to the gratification of mass adulation and responds physically as well as psychically to the veneration their followers displays. So populism could become a powerful force in the nations whose politics it impels. Populism uses political mobilisation, recurrent rhetoric and symbols designed to build heterogeneous multi-class coalitions led by sectors of the urban middle-classes. Populism responds to the problems posed by economic underdevelopment and proposes strategies of accelerated industrialisation through redistributive measures. Its main enemy is the landed oligarchy and foreign capital allied with local elites. Populist economic policies aim at gaining full control over national resources in order to finance import-industrialisation programmes. Its economic policies include budget deficits stimulating domestic demand, nominal wage increases combined with price controls to effect income redistribution, and exchange-rate control or appreciation to cut inflation and to raise wages and profits in non-traded-goods sectors.

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In general, Latin American populism has exhibited three interconnected features. First, it has been dominated by paternalistic, personalistic, often charismatic leadership and topdown mobilisation. Second, it has involved multi-class incorporation of the masses, especially urban workers but also middle-class sectors. Third, populists have emphasized integrationist, reformist, nationalist development programmes for the state to promote simultaneously redistributive measures for populist supporters and, in most cases, import-substitution industrialisation. Populism has been most common in Latin America where competitive party systems have been weak and military interventions frequent, as in Peru, Argentina, Ecuador, and Brazil. In those countries, populists have filled the vacuum created by the weakness of civilian political institutions. By contrast, populism has been uncommon in nations with strong party systems and relatively non-interventionist militaries, including Costa Rica, Colombia, Venezuela (after 1958), Uruguay, and, in many respects, Chile, which has never been ruled by a mesmerizing leader of a multi-class urban movement committed to rapid elevation of the workers and hothouse industrialisation. Charismatic figures have rarely been successful in Chile because of the highly Europeanised, institutionalised, and durable political parties. Organisations filling the ideological spectrum, left little room for personalistic mass mobilisation or independent adventures.5 Populism and its aftermath have dominated the political history of modern Latin America. Much of the style and rhetoric of politics derives from populism. More important, some seemingly unbridgeable schisms in today's society can be traced directly to populism. While populist movements attract the 5

Kenneth M. Roberts, Deepening Democracy? The Modern Left and Social Movements in Chile and Peru, Stanford: Stanford University Press, 1998, pp. 81-162.

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support of masses of people, they simultaneously repel major sectors of society. Populists define themselves as the saviours of the nation and their opponents as enemies of the people. Thus politics revolve around movements that win strong allegiances but exclude their enemies. This contributed in the past to a cycle of military takeovers that ultimately produced massive violence, involving both the military and civilians. Populism addresses certain problems, but it also produces new ones. A key populist legacy is leadership style. The leader, whether in power or exile, dominates his party for long stretches. The party might undergo internal struggles, but once the leader has settled them, his rule is unchallengeable. Within the Peronist Party, this role of caudillo was borne by two men; the baton of Juan Perón was eventually picked up by Carlos Menem. This pattern of leadership is more noticeable within the Radical Party, which even after ceasing to be populist retains its style. Hipólito Yrigoyen was followed by Marcelo T. de Alvear, Ricardo Balbín and Raúl Alfonsín. They continued to dominate their Radical Party after their popularity had faded with the public at large. Even when the parties adopted attributes of "modern" politics, such as conventions, they continued to be dominated by strong-willed leaders. The 1980s were a decade of crisis in Latin America. In Peru Sendero Luminoso ate away at the legitimacy and authority of elected presidents. In the wake of violent confrontations, the villagers of the central sierra organised self-defence units, or rondas campesinas. And thus Senderistas and ronderos faced each other in the same upland regions. If, as dependencistas assert, the locus of power in lessdeveloped societies reside in the capitalist metropolis, then the popular sectors are excluded from the political arena and have no chance for successfully challenging the power structures, for which reason many dependencistas urge for a complete and immediate break with world capitalism. If, on the contrary, the

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locus of power is internal, then the relevant arena is one in which the popular sectors do have at least a potential for political self-help. Indeed, populist policies made the masses winners in the political game, rather than losers. Populists provided more opportunities for the masses to improve their lives. At its very core, Mexican populism addressed the needs of the people, mainly the poorest classes. Unlike the neoliberals of the Fox Administration who govern Mexico today, populists spoke for government action to achieve a more equitable distribution of wealth. Populism in Mexico resembled European social democracy and the U.S. concept of the welfare state. Mexican populism also contained nationalism and corporatism.6 The former meant promoting economic development using mainly Mexican capital. The latter entailed efforts by the government to build up labour, farmer, middle-class, and even business associations and to integrate them into the state itself, or rather to be intermediary between the rank and file and the leaders.7 Between a Mexican state that emerged as hegemonic and a Peruvian state that never stabilised because it marginalized popular political cultures, the difference is striking. When in Peru social control became a central imperative in the construction of the post-war state, authoritarianism emerged as much from the failure of mediation by village intellectuals and other intermediate elites as it did from a renewed alliance with the landowners. Are indigenismo, Senderismo, APRA populism and the socialism of José Carlos Mariátegui aspects of the same so-called Andean utopia?8 However, the fact that imperialist domination in Peru has hitherto been exercised principally 6

Donald Hodges and Ross Gandy, Mexico 1910-1982. Reform or Revolution?, London: Zed Press, 1983, pp. 99-121. 7 Florencia E. Mallon, Peasant and Nation. The Making of Postcolonial Mexico and Peru, Berkeley, Los Angeles and London: University of California Press, 1995, pp. 310-330. 8 Ibidem, p. 326-327.

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through enclave exploitations of agro-extractive resources and the fact that industrial production from the very outset showed only weak growth under the control of foreign companies, the national bourgeoisie was not able to establish its hegemony. Nationalist movements were therefore headed by pettybourgeois intellectuals and technico-professionals with no ties to the popular masses.9 Populism began late in Brazil because entrenched antidemocratic political leaders resisted opening up the system to broad participation. But by mid-century populism reached a fever pitch. During the 1950s nearly a dozen figures fought for national office in populist fashion, and they left a major imprint on the political culture. The military takeover of 1964 brought the demise of the so-called Populist Republic, the most intense political arena in the Americas at the time. After a decade of repressive government, the military began to allow more open participation again, and a few of the old-timers returned and managed to win state-level offices. None of the elder populists could get a clear shot at the presidency, however, and the promising career of newcomer Fernando Collor de Melo crashed two years into his term as president. By the mid-1990s the populist style in politics seemed destined to fade from the scene, replaced by more moderate approaches. Populism arose in Peru in the 1930s to fill a need for a more modern, inclusive politics for the masses. The old regime could no longer respond to the powerful social and economic changes brought on by urbanisation after World War I. This was especially true in and around the capital of Lima. The old political elite was morally and politically bankrupt. The early 1930s witnessed the rise of two strong populist movements, the Alianza Popular Revolucionaria Americana (APRA, American Revolutionary Popular Alliance) led by Víctor Raúl Haya de la 9

Aníbal Quijano, Nationalism & Capitalism in Peru: A Study in NeoImperialism, New York and London: Monthly Review Press, 1971, p. 85.

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Torre, and the electoral machine of Luis M. Sánchez Cerro. These two competing campaigns ushered in a new era, yet the populists were shut down by mid-decade by the army and the forces of reaction.10 Five decades later, Peru experienced a populist resurgence with the Aprista government of Alan García (1985-90). His presidency also replaced one that was bankrupt in the eyes of the people.11 After the breakdown of García’s government, neopopulism emerged with by Japanese descendant Alberto Fujimori. His election in 1990 was a watershed in the country’s history. Fujimorismo was marked by a visible increase in political activity by the working classes of Lima, but the unions did not represent a real obstacle to Fujimori’s policy shift. They had been weakened by the growth of the informal economy and the economic crisis. The divided left remained very critical of Fujimori’s orienting the economy to the external markets and his privatisation programme, but was divided and unable to mobilize the urban and rural masses into a united front. Fujimori mobilized the votes of the lower classes and the mestizos against the party elites, not against the oligarchy.12 During the 2006 presidential campaign Peru’s populism gained a new momentum with candidate Ollanta Humala. The latter pledged to legalize all coca production, arguing that the coca leaf could be used for legal products, such as tea, toothpaste, and even as a foodstuff. His position on coca was part of a broader, populist, anti-Peruvian elite campaign. Given

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David G. Becker, The New Bourgeoisie and the Limits of Dependency: Mining, Class, and Power in ‘Revolutionary’ Peru, Princeton: Princeton University Press, 1983. 11 The Revolutionary Government of the Armed Forces had discredited itself in the late 1970s. Then came the precipitous decline of the centre-right technocracy of Fernando Belaúnde Terry (1980-85). 12 Kenneth M. Roberts, ‘Neoliberalism and the transformation of populism in Latin America: the Peruvian case’, in World Politics, 48 (1) 1996, 82-116.

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the way coca is woven into the history and culture of the Andes,13 it is his position on the leaf -- which many Peruvians consider sacred -- that is critical.14 In 2006, Humala launched his campaign for the presidency, winning the first round of voting against APRA-candidate Alan García. As the opinion polls had forecast, Alan García defeated Humala by an ample margin in most coastal areas and in greater Lima, regions making up modern Peru. Humala won two-thirds of the votes in the southern and central Andes, where many people are of indigenous descent and have seen little benefit from economic growth.15 This reveals how some class strata in Peru have become associated with the modern, internationally linked capitalist sector, while others remain rooted in the traditional national sectors, especially subsistence agriculture, small-scale manufacturing, much of the service economy. Therefore, “modern” dependencista class analysis having surpassed “comprador” generalisations, in the 1970s already argued that the key to external control is found in the fractionalisation of domestic class structures.16

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Peru and Bolivia always refused to jeopardize their lucrative coca leaf operations. William O. Walker III, Drug Control in the Americas, Albuquerque: University of New Mexico Press, 1981. 14 Like colonel Hugo Chávez in Venezuela and colonel Lucio Gutierrez in Ecuador, colonel Ollanta Humala was involved in a failed coup attempt in Peru. In October 2000, in the mining town of Toquepala in southern Peru, Humala led a small military uprising against Fujimori and Vladimiro Montesinos, the dreaded former intelligence chief. The revolt rapidly fizzled, but Humala is praised in the local press for his courage. After Fujimori was impeached later that year, Congress pardoned the rebels, and Humala rejoined the military. 15 The Economist, June 10th 2006, p. 57. 16 Osvaldo Sunkel, ‘Transnational capitalism and national disintegration in Latin America’, in Social and Economic Studies, vol. 22, March 1973, pp. 132-176.

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Nowhere else but in the Andean region of Latin America have leaders of a failed coup gone on to win presidential elections. Only in Venezuela, Ecuador and Peru have botched coup attempts bestowed the kind of name recognition invaluable for a political career. Many factors help explain this recent Andean phenomenon — among them, the region's extreme poverty, distrust of the corrupt traditional political parties and the relatively good reputation of the countries' militaries. Perhaps more important is that the racial and indigenous groups that traditionally have been excluded from politics are increasingly reshaping these societies. In Ecuador and Peru, indigenous Indians make up nearly half the population. Venezuela, Ecuador and Peru all have mestizo majorities. The story of populism in Venezuela centres on one movement and to a certain extent on one man, Rómulo Betancourt, founding member and lifelong head of the party called Acción Democrática (AD, Democratic Action). The party's precursor organisations began among exiled students during the dictatorial regime of Juan Vicente Gómez in the 1930s. At first heavily Marxist in orientation, they shifted their public stands after Gómez's death in 1935 and de-emphasized ideological formulations. Nevertheless, many of Betancourt's followers expected that when AD eventually came into office, it would reveal the extent of its socialist leanings. Yet by the time it finally did accede to power in 1945 by means of a coup d'état, the AD had evolved into a populist party like so many others in post-war Latin America. Following the coup, Betancourt and the AD swept into power in the country's first direct, secret, and honest elections ever. These peak years of Venezuelan populism have become known as the Trienio, a heroic period of farreaching reforms and organisational inroads for workers, peasants, and students. Before completing their term, however, the AD leaders were overthrown by the military in 1948.

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Betancourt and his followers returned to power in 1958, and since then Venezuela has enjoyed a long succession of elected governments. The AD's principal rival, the Partido Social Cristano Copey (Christian Democratic Party), managed to win several presidential elections, thus establishing a periodic alternation between the two parties. Political observers generally admired Venezuela as one of the most democratic nations in the region in the 1970s and 1980s. Thus the legacy of populism was generally seen as positive, although more recently it has come under attack. POPULISM AND NEOLIBERALISM Although many works have argued persuasively that populism is a recurring phenomenon, rather than a period-specific historical anomaly, there is still a tendency to associate it with etatist and redistributive policies that are antithetical to neoliberalism. As such, the spectre of populism in contemporary Latin America is usually equated with a lower-class backlash against the austerity, inequalities, and market insecurities attendant on neoliberalism. Likewise, presidents and finance ministers who implement IMF-approved stabilisation plans routinely pledge to resist the "populist temptation"--that is, the politically expedient but fiscally "irresponsible" increase of government spending to ameliorate the social costs of market reforms. The possibility that populist tendencies could arise within--rather than against-a neoliberal project has yet to be fully explored. Four principal perspectives on populism can be identified in the Latin American literature: (1) the historical/sociological perspective, which emphasizes the multi-class socio-political coalitions that typically arise during the early stages of industrialisation in Latin America; (2) the economic perspective, which reduces populism to fiscal indiscipline and a set of expansionist or redistributive policies adopted in response to

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pressures of mass consumption; (3) the ideological perspective, which associates populism with an ideological discourse that articulates a contradiction between "the people" and a "power bloc"; and (4) the political perspective, which equates populism with a pattern of top-down mobilisation by personalist leaders that bypasses or subordinates institutional forms of political mediation. During the 1970s and 1980s, Latin American countries had to adapt their populist strategies to the IMF-approved stabilisation programmes. Alan García in Peru (1985-1990) tried to continue the old import-substitution strategy and incomeredistribution programmes. Other post-dictatorship presidents, like Raúl Alfonsín (1983-1989) in Argentina or José Sarney (1985-1990) in Brazil, refused to solve the economic crisis by imposing costs on the productive sector. However, in both cases high inflation and economic decline were their fate. It was the period that Latin America’s economic policy shifted to a neoliberal development strategy as a consequence of the exhaustion of its import-substituting industrialisation strategy financing unsustainable social programmes. Excessive lending combined with high interest rates had caused in 1982 the Mexican debt crisis spreading over the whole continent. However, the collapse of import-substitution industrialisation and the onset of the neoliberal era do not require a "requiem for populism," as some anticipated.17 Instead, the new era may be associated with the transformation and revival of populism under a new guise, one that is shaped by the breakdown of more institutionalised forms of political representation and the fiscal constraints that inhere in a context of public indebtedness and a diminished state apparatus.

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J. Demmers, A.E. Fernández and B. Hogenboom, Miraculous Metamorphoses. The Neoliberalization of Latin American Populism, London and New York: ZED Press, 2001.

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More "liberal" variants of populism not only represent a different economic project than traditional, "etatist" populism, but also rest upon new social bases (that is, informal sectors rather than organized labour) and a new articulation of the contradiction between "the people" and the "power bloc." Like classical populism, this new form of neoliberal populism is likely to manifest contradictions and limitations. The collapse of the neoliberal economic order in Latin America and the downfall of Fujimori in Peru and Menem in Argentina have discredited monetarist and other neoliberal experiments. Does it mean “back to normalcy” and “populism as usual”? What went wrong with neoliberal populism in the 1990s? Once the initial political dividends of inflation control have worn off, the long-term capacity of targeted social programmes to provide political cover for an economic model that generates growth without employment is subject to doubt, especially when social programmes rely on one-shot infusions of financial resources. The more enduring classical populists built party or labour organisations to complement their personal appeal and integrate followers into the political system, something the new generation of liberal populists has shown little inclination to do. Although the inclusiveness of classical populism was always selective, it was far deeper than that of liberal populism, which spawns little organisation, no political role for citizens beyond that of voting, and a more limited and exclusive set of economic rewards. Finally, the "politics of antipolitics" is a weak substitute for the cross-class nationalist appeal of classical populism, and it is likely to be self-limiting as a populist formula for legitimising an incumbent government. However potent it may be for political outsiders and protest movements, it becomes selfnegating once the outsiders displace the traditional political class, turn into incumbents, and construct a new political establishment.

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The viability of liberal populism during periods of institutional crisis and social transformation is relatively short (Argentina, Ecuador, Peru, Bolivia, Brazil). As such, it has profound implications for opponents as well as supporters of neoliberalism. For opponents, it warns against the comforting assumption that neoliberalism is incapable of generating a broad base of political support, and thus will inevitably produce a popular backlash in favour of progressive alternatives. Indeed, it provides compelling evidence that neoliberalism is both a consequence and a cause of the weakening and fragmentation of the popular collective actors who are essential to any progressive alternative. For those who share in the "Washington consensus" favouring neoliberal reforms, the Peruvian case is a sobering reminder that economic restructuring may come with unexpected political ramifications. Proponents of neoliberalism may find it unsettling to contemplate whether they are presiding over the transformation and revival of populism, rather than its burial. More important, the emergence of liberal populism casts a large shadow over facile assumptions that free markets and representative democracy are kindred phenomena. The historical development of representative democracy in the West was heavily influenced by the efforts of subaltern groups to organize collectively to exert political control over market insecurities; in order to eliminate such controls, modern neoliberal technocrats have routinely suppressed or circumvented the mechanisms of accountability that inhere in democratic organisation. Although personality may be an effective force for political aggregation and legitimation in tumultuous times, the shifting sands of public infatuation and the whims of autocratic rulers are hardly desirable long-term foundations for the neoliberal edifice, as the Russian case amply demonstrates. As such, the predilection for autocracy--for the political power to implement economic reforms unencumbered by institutionalised

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mechanisms of representation and accountability--is likely to clash with both the political need to establish institutional roots in civil society and the popular tendency to rely on democratic organisation as a counterweight to individual market insecurities. These tensions can be expected to shape the evolutionary dynamics of liberal populism in the years to come; more fundamentally, they will be decisive in determining whether the denouement of the neoliberal era will be democratic or authoritarian. THE FUTURE OF THE LULA EXPERIMENT IN BRAZIL In 2002 Luiz Inácio “Lula” da Silva of the Partido dos Trabalhadores (PT, Party of the Workers) defeated in the second round Partido da Social Democracia Brasileira (PSDB, Party of Brazilian Social Democracy) candidate José Serra for the presidency. Lula’s election meant the end of the neoliberal decade in Brazil which was marked by Fernando Henrique Cardoso’s two presidential terms (1994-2002).18 Lula’s victory was the result of deteriorating socio-economic conditions and the break-up of the government’s class base. Meanwhile Lula was attracting PSDB’s votes. Nevertheless, there were indications that important changes had taken place that would limit his possibilities. He distanced himself from the landless workers movement MST (Movimento dos Trabalhadores Rurais Sem Terra) and the unions.19 18

Lula’s political career had started in 1989 when he was defeated as presidential candidate by Fernando Collor de Mello. José N. Novelli and Andréia Galvão, ‘The political economy of neoliberalism in Brazil in the 1990s’, in Andréia Galvão and André Mommen, Policy Reforms and Resistance to Neoliberal Globalization in the United States, Canada, Brazil, Argentina, and Russia, Part II, International Journal of Political Economy, 31 (4) 2001-2002, 3-52. 19 James Petras and Henry Veltmeyer, Social Movements and State Power. Argentina, Brazil, Bolivia, Ecuador, London and Ann Arbor: Pluto Press, 2005, pp. 111-113.

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Lula and the PT still criticized the ideology of neoliberalism, but they conformed to the limits it had set. Lula’s “Zero Hunger” programme must be viewed as an integral part of analogous neoliberal anti-hunger campaigns in the world, not as an extension of the welfare state and its universal provisions. In neoliberal thinking social resources should be channelled to the “poorest”, a policy also advocated by the World Bank. Since his election in 2002, Lula has emerged unscathed from several affairs, especially the political crisis of corruption his government suffered in 2005. With his popularity on the rise, it is likely he will be re-elected for another four years in October 2006. The polls released in January 2006 leave no room for doubt: Lula has recovered a good portion of the popularity he lost in 2005 and is in good condition for a victory in the upcoming election in October 2006, or at the latest, November 2006 when the count is finalized.20 The nature of Lula's social support has been changing over the past tenure in office. The traditional foundations of support on which the PT rested came from industrial labourers and a certain sector of the urban middle class with university education. Today, however, the profile has changed, to the point where the sole explanation for Lula's rise lies in the assistance programme “Bolsa Familia,” (family welfare) created in October of 2003. The two positions, that of those who criticize Lula because he has done little and that of those who defend him because he has made some changes, are based on real facts. It is certain that the poor are leading somewhat better lives, just as it is true that the country continues to sink into the fundamental tendencies of neoliberalism. In the middle, the process now taking place is what Pochman21 calls an impoverishment (“débourgeoisement”) 20

According to all projections, Lula will defeat Geraldo Alckmin, governor of the state of Saõ Paulo, who is running on the opposing PSDB ticket. 21 Brasil de Fato, interview with Marcio Pochman, “País é prisioneiro da elite nacional”, 2 March 2006.

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of the middle class. This is a powerful trend in the neoliberal model that facilitates the unity of action between the poorest and middle-class sectors, as was the case in Argentina. But in the short term, it appears Brazil's middle class is supporting Lula while the poor—who have always supported conservatives— have become devout Lulistas. These tendencies present two problems. The support from the poor all but guarantees Lula a victory in the campaign for a second term. But unlike in the 1970s and 1980s when industrial workers identified with the PT out of political motivations, the party now draws its votes based on the State aid given out under the Bolsa Familia project22 This tends to reproduce the pattern of clientelism that already exists in the region. Second, there are no deep-seated changes taking place in the trends: between 1930 and 1980, Brazil underwent a process of industrialisation. Since 1980, it has experienced a cycle of State-sponsored financialisation and a decline in industry. Under Lula, this trend is only deepening. Bolsa Familia benefits nearly 9 million poor families, or more than 30 million people in a country of 180 million inhabitants. It is estimated that the programme reaches 77 percent of poor families with incomes under US$45 a week, totalling 11 million, 49 percent of whom live in the Northeast portion of the country. This region—until recently, dominated by right-wing leaders—is where Lula now receives his highest level of support: 55 percent compared to 29 percent in the Southeast, the region where the PT was born and where Lula had the strongest hold during the 2002 elections. Corruption scandals have affected public opinion among the middle class and union workers, but to the poorest part of the population, they seem to have little relevance. What is occurring in Brazil is an enormous transfer of the national income into the financial sector, which is increasingly 22

Bolsa Familia (Family Welfare): 8 million families receive US$32 a month from the government.

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cartelised but no more efficient. ‘What is interesting is that the earnings by the banks cannot be accounted for by increased efficiency. Rather, they are being generated by an abuse of economic power and a fragile institutionality,’ 23 explains economist Reinaldo Gonçalves, professor of the Federal University of Rio de Janeiro. Approximately 35 percent of public debt ownership, which represents more than half of the GDP, is in the hands of banks. Since the government pays very high interest rates, it benefits the investors to invest more in debt than in building factories, for example. Economist Ceci Vieira Juruá of Attac-Brasil says the banks, insurance companies, and transnationals have increased their capital worth in Brazil while the middle class, local businesses, and public finances have suffered. This has been caused, in her opinion, by a process of ‘reconcentration of income in favour of investment capital and against worker output,’ and greater debt incurred by the federal government, which is reflected in the third factor, the ‘de-industrialisation and de-nationalisation of the local system of production.’24 According to another economist, Marcio Pochman of the University of Campinas, the US$120 billion paid by the State each year to debt security holders (some 20,000 families) makes up 7-8 percent of the GDP. This is the percentage of Brazil's wealth that is transferred to the rich every year. Pochman's assessment of the country's evolution over the last decade of neoliberalism insists that privatisation and financial deregulation have given the powerful even more power. ‘The economy today is managed in accordance with the interests of the 20,000 families who account for ownership of 80 percent of the total amount of public debt. This segment is so powerful it is capable of controlling the country's economic policies. If interest rates fall, they will simply take their money, stop financing the debt, 23 24

http://upsidedownworld.org/main/content/view/244/63/ http://upsidedownworld.org/main/content/view/244/63/

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and leave. The Brazilian economy has been organized more and more to protect those interests.’25 One of the hardest facts the Lula government has had to deal with is that economic growth in 2005 was much lower than expected—only 2.3 percent, the lowest in Latin America after Haiti. In the years of Lula's government, economic growth has been mediocre, averaging 2.6 percent, lower than the first three years of Henrique Cardoso's government, which saw a rate of 3.4 percent. The “spectacle of growth” Lula promised upon election is not occurring, in spite of the fact that exports have doubled during this same time period. For a good portion of analysts, the poor growth, which takes place at a time when emerging economies (among them China) are growing at an average rate of 8-9 percent, can be explained by the financial sector, the one most benefited by state politics. In effect, investments and industry are growing at a slow rate due to the high interest rates being paid by the State, the highest in the world, at 16.5 percent annually. This explains how during a time of economic stagnation, banks have registered the highest profits in their history. The earnings of Bradesco, the country's largest bank, were 80 percent higher than in 2004 and the highest in the Latin American open-capital bank's history. The second bank, Itaú, had earnings that exceeded 2004's by 39 percent. The banks that follow on the list (Banco do Brazil, Caixa Económica Federal, and Unibanco) also registered the largest profits in their history. According to available information, in 2005 the government spent US$63.2 billion (139 billion reales) on debt servicing to deal with the internal and external debt (85 percent and 15 percent, respectively). This figure represents no less than 23 percent of Brazil's total budget: nearly one out of every four dollars the government spends goes toward paying amortizations and interest on the debt. This would be a noose around the neck for 25

http://upsidedownworld.org/main/content/view/244/63/

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any country, but in Brazil's case, the government is the one that has tied the noose itself, by opting for the highest interests rates in the world in order to bring in capital and thus pay off its debt. According to the National Conference of Brazilian Bishops (CNBB, Conferência Nacional dos Bispos do Brasil) the country has become a financial paradise. The CNBB is a long-time ally of Lula and the PT, supporting them since the beginning, and it played an important role in opposing the military dictatorship that came to power in 1964. Bishop Odilio Scherer, Secretary General of the CNBB, directly accused Lula of having turned the country into a “financial haven,” and Archbishop of Salvador da Bahia, Geraldo Majella Agnelo, was harsher still when pointing out: ‘There has never been a leader so submissive to the banks.’26 BOLIVIA’S REALIGNMENT UNDER MORALES Regaining the autonomy that was taken away by the privatisation of natural resources under the previous government of Gonzálo Sánchez de Losada was a promise Morales made during his presidential campaign. Evo Morales read the decree in which the nationalisation of the natural gas industry was announced with the consideration that ‘in historical struggles, the people have conquered and paid with their blood, the right to return our natural resources and our wealth in natural gas to the hands of the nation and to be utilized to the benefit of the country.’27 What will be the next step? Is this a prelude to the revolution? Morales did not reveal a scenario for his revolution. However, Bronfenbrenner formulated already in the 1950s a 26

‘O que a ideologia uniu, não separe o pobre’, André Arruda Plácido, 10 de março de 2006. http://www.midiasemmascara.com.br/artigo.php?sid=4661 27 Walter Mignolo, ‘Populism or another rout to democracy?’, ALAI Latin America in Movement. www.alainet.org/active/11381&lang=en

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workable scenario for Morales’ revolution: ‘Comes the revolution. It may indeed be a social revolution, with or without substantial violence. It may be a capital levy at rates close to 100 percent. It may be “nationalisation”, with compensation wiped out by rapid inflation.’28 Evo Morales and his Moviemento al Socialismo (MAS, Movement for Socialism) took power in January 2006 with a clear popular mandate. Social uprisings starting in 2000 demanded that the state nationalize the country’s natural gas and petroleum so the lucrative profits of these industries could be used to help lift South America’s poorest country out of poverty. Three presidents resigned or were forced out of office by these popular protests. Evo Morales, the country’s first Indian president, is dramatically reshaping his country’s destiny. His democratic project is different from that of the Bolivian populist and nationalist political parties having ruled the country since the 1950s. The Morales movement is the product of grass-roots movements, not of a technocratic elite or professional politicians competing for power and spoils. MAS is not a “normal” populist party making deals with financial oligarchs, foreign capital or state technocrats. Officially founded in 1998, MAS spearheaded the movement against water privatisation in Cochabamba.29 As Vice-President Alvaro García Linares has noted, the goal of MAS is ‘to achieve hegemony,’ and the Constituent Assembly is ‘central to this process.’30 Bolivia has been unstable for years because of poverty, military revolts, and the conniving of the country’s 28

M. Bronfenbrenner, ‘The appeal of confiscation in economic development’, in A. N. Agarwala and S. P. Singh (eds) The Economics of Underdevelopment, New York: Oxford University Press, 1958, p. 477. 29 John Crabtree, Patterns of Protest. Politics and Social Movements in Bolivia, London: Latin America Bureau, 2005, pp. 28-30. 30 http://www.focusweb.org/index2.php? option=com_content&do_pdf=1&id=926.

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political elites as they loot the public treasury. As in Venezuela prior to Hugo Chávez’s election,31 the traditional parties are viewed as bankrupt.32 Evo Morales and MAS want to breath new life into the country’s political and social institutions, to give voice to the country’s indigenous poor.33 Indeed, in the footsteps of Karl Polányi,34 one may assume that if globalisation is the ultimate enclosure of the commons – ‘our water, our biodiversity, our food, our culture, our health, our education’ – then reclaiming the commons is the political, economic, and ecological agenda for our times. The ethnic character of this poverty fed the massive discontent that led to the triumph of Evo Morales as the country’s first Indian president. Many landless peasants, predominantly of Quechua and Aymara origins, have migrated out of the Andean west to the low lands in the east. There they often work in conditions of abject servitude on the large estates of non-indigenous owners, many of whom claim de facto possession of large tracts of idle or underutilised lands that they refuse to sell or distribute to the landless Indians. Outlining a series of sweeping proposals for changes in the country’s agrarian reform laws, the Morales government is taking on the country’s elite economic interests located in the eastern region of the country. This is where most of the large land ed estates are located, many of them acquired through political corruption and land speculation over the last three decades. According to Miguel Urioste, the director of the Land Foundation, an independent research centre in La Paz, ‘Bolivia has a dual land system, the minifundias and subsistence 31

Michael McCaughan, The Battle of Venezuela, London: Latin America Bureau, 2004. 32 Richard Gott, Hugo Chávez and the Bolivarian Revolution, London and New York: Verso, 2005. 33 Oscar Olivera, ¡Cochabamba! Water War in Bolivia, Cambridge, Massachusetts: South End Press, 2004. 34 Karl Polanyi, The Great Transformation, Boston: Beacon Press, ed. 1957.

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agricultural plots in the west, and the capitalist enterprises tied to the latifundias in the east.’35 The prosperous estates produce soybeans, cattle and other agricultural export commodities that have enriched a bourgeoisie based in Santa Cruz, Bolivia’s third largest city. In the 1980s Bolivia was on the cutting edge of the trend toward privatisation, adhering to an IMF-recommended structural adjustment programmes. The pro-corporate reforms proved profitable for the multinational energy companies involved, but they utterly failed to benefit the Bolivian people. Today 64 percent of the population lives in poverty, with a majority of people scraping by on less than US$2 per day. 36 A March 2006 report by the Center for Economic and Policy Research shows that, according to the IMF's own data, real percapita gross domestic product (GDP) in Bolivia is lower now than it was 27 years ago.37 The devastating poverty that afflicts South America’s poorest country Bolivia is bound up with this dysfunctional land system. Out of Bolivia’s 9 million inhabitants, 3.5 million people live in the countryside with about 80 percent subsisting at the poverty level. García Linares noted in his address on agrarian reform that 40 percent of the country’s peasants and inhabitants of the indigenous agricultural communities live in conditions of extreme poverty, earning less than US$600 a year. The Bolivian landless movement in recent years has occupied some of these idle lands, meeting violent resistance from the large landowners. As Miguel Urioste of the Fundación Tierra (Land Foundation) notes, ‘a climate of violence and confrontation over access to land has led to the injury and death 35

www.ftierra.org/ftierra1104/ piestierra/larazon/02-07-10.pdf On May 1, 2006, President Morales announced that the minimum wage would increase by 20 percent from its current level of BOL$440 a month. The trade unions had been pushing for a doubling of the minimum wage. 37 To read the report, by Mark Weisbrot and Luis Sandoval, see: http://www.cepr.net/publications/bolivia_challenges_2006_03.pdf 36

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of many peasants.’ The Morales government will implement many of the changes it proposes in the agrarian reform law by executive decree and through legislation in Congress. ‘But if it meets with sustained opposition it will use the Constituent Assembly that will be elected in early July to restructure the country’s agrarian policies as well as its political institutions’, said Urioste. A few leaders express reservations. Felipe Quispe, the former head of the Confederación Sindical Unica de Trabajadores Campesinos de Bolivia (CSUCTB, Union Confederation of Rural Workers of Bolivia) who has often challenged Morales from the left, said: ‘The government is committing an error because it is offering to discuss the agrarian reform plan with the large landowners who have historically exploited the peasants.’38 Sectors of the landed bourgeoisie in Santa Cruz have already proclaimed their staunch opposition to the proposed changes in the agrarian reform laws, even though the government has offered to discuss the legislation with them. Virtually all the business and entrepreneurial associations in Santa Cruz under the leadership of Branko Marinkovic of the Federación de Empresarios de Santa Cruz (Federation of Private Businesses) issued a proclamation expressing their ‘deep concern with the measures of agrarian reform that are coming from the administration of Evo Morales.’39 Militant indigenous movements are already intending to take over large estates. President Manuel Dosapei of the Coordinador de los Pueblos Étnicos de Santa Cruz (CPESC Ethnic Peoples of Santa Cruz) announced its determination to seize 14,000 hectares owned by Branko Marinkovic. This land will automatically be taken because it is ours, ‘declared a representative of the ethnic groups. An official of the business 38

www.globalexchange.org/ countries/americas/bolivia/3941.html - 32k - 11 juni 2006 39 www.globalexchange.org/ countries/americas/bolivia/3941.html

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coalition shot back: ‘this is an abusive assault and we are going to defend our private property with determination.’40 With the government’s expropriation decree, fifteen corporations have been nationalized, with foreign capital from a wide variety of nations, including the United States, Spain, Great Britain, Brazil, France and the Netherlands.41 Seizing control of these enterprises goes to hand in hand with Bolivia’s audacious steps in the trade arena. MAS and Morales view neoliberalism, US trade agreements, and corporate-driven globalisation as major obstacles to the country’s development. Adriano Pires, director of the Brazilian Centre for Infrastructure Studies, who said: ‘Governments in the region see energy as a commodity they can use to push populist agendas… From a political point of view, it’s a powerful issue to manipulate, but from an industrial point of view, it can do real harm’.42 The industrial sector and the government of industrial countries are not considering the possibility that the nationalisation of Bolivia’s huge natural gas reserves43 - in 2005, estimated natural gas reserves were 26.7 trillion cubic feet (TCF) - could be a way to fight poverty. Regaining the autonomy that was taken away by the privatisation of natural 40

www.bolpress.com/temas.php?Cod=2006030213 Antonio Brufrau, the head of Spain's oil company, Repsol, said at a conference in Barcelona on 23 May, 2006, that he hoped that Morales would model his reform, or nationalisation of the Bolivian oil and gas industry, on what President Chávez had done in Venezuela. Repsol is the second-biggest foreign investor in Bolivia's oil and gas industry. www.guardian.co.tt/archives/ 2005-09-11/bussguardian11.html 42 http://economistsview.typepad.com/economistsview/2006/05/exchange_rat es.html 43 Bolivian natural gas reserves Probable reservesReserves TCFAnnual differenceProductionDifference200328.7 200427.61.1 TCF0.36 TCF0.71 TCF200526.70.9 TCF0.45 TCF0.45 TCFSource: Raúl Escalera, ‘La nacionalización de Morales’, Observatorio de Conflictos Sociales, 2006, Vol. 3 (2), La Paz. [ALAI Latin America in Movement]. 41

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resources under the government of Gonzálo Sánchez de Losada may not be going back to the national populism of the 1970’s in Latin America, but moving forward to a new way of doing politics and economy (the de-colonial way, as it is being conceptualised in Bolivia). The trade agreement and the nationalisation of Bolivia’s natural resources mark a dramatic shift in hemispheric affairs. Morales is serving notice on Washington that he is becoming part of a radical bloc of nations in Latin America that are no longer subservient to the United States.44 This discontent with the Andean community led to the signing of the People’s Trade Agreement between Cuba, Venezuela and Bolivia on April 29, 2006. The accord is particularly favourable to Bolivia as to Cuba and Venezuela have agreed to take all of Bolivia’s soy production as well as other agricultural commodities at market prices or better. Venezuela will also ship oil to Bolivia to meet domestic shortfalls in production while Cuba will send doctors to Bolivia. Peru has also just signed a trade agreement with the United States that will have an adverse impact on Bolivian exports to Peru. These accords have ruptured the thirty-seven year old Andean Community of Nations, a trade pact that included Venezuela and Ecuador as well as Bolivia. Hugo Chávez announced in April 2006 that Venezuela is withdrawing from the pact because the United States has ‘fatally wounded’ the community. Morales also stated that Bolivia is reconsidering its membership. At the same time Morales is moving to reshape the country’s commercial relations, particularly with Venezuela. Hugo Chávez flew to Bolivia declaring ‘we are going to 44

It is worth noting that even in Chile 83 percent of Chileans asked in recent opinion poll whether the state copper company, Codelco, should be privatised said no. Governments are insisting on is that foreign companies should pay a proper price for the assets they are exploiting in the region.

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concretise the People’s Trade Treaty,’45 an accord that was recently signed between Venezuela, Bolivia and Cuba. It is openly pitched as an alternative to the US-backed Free Trade Area of the Americas (FTAA), a trade zone based on neoliberal principles that facilitates the expansion of multinational corporations. Bolivia and Venezuela have signed eight different accords dealing with 200 different projects concerning energy, mining, education, sports and cultural exchanges. Most importantly Venezuela has agreed to invest over US$1 billion to help industrialize Bolivia’s natural gas production, including the construction of a petrochemical complex.46 The burgeoning economic alliance between Venezuela and Bolivia also helps offset the difficulties that have arisen with Brazil and Argentina over Morales’s determination to exert greater control over natural gas exports.47 Both neighbouring countries have significant investments in Bolivia’s gas fields, and both are importing gas for domestic use at prices well below the world market. At a recent international gathering of Latin American and European leaders in Vienna, Austria, Morales and President Lula of Brazil exchanged harsh words over efforts to draft a new accord over natural gas.48 While the two leaders 45

www.americas.org/item_27548 Ricardo Ángel Cardona, ‘Industrialización en manos de Evo Morales’, ALAI Latin America in Movement. www.alainet.org/active/10393&lang=en 47 Roger Burbach ‘Bush squares off with Bolivia and Venezuela over hemisphere model’, ALAI Latin America in Movement. www.alainet.org/active/11611&lang=en 48 The government said that if it increased the price it charges Brazil and Argentina for natural gas by US$2 per million British Thermal Units (BTU), to US$5.50, the country will earn an extra US$600m a year. The government had previously claimed that the fiscal deficit is running at US$320m a year, but it expects to push through an increase in gas prices for Argentina and Brazil that will cut the deficit. The finance minister, Luís Arce, said that the US$270m deficit would be equivalent to about 3.2 percent of GDP. At the end of 2002 the fiscal deficit was 8.8 percent of 2002. In 2003 the deficit was 7.9 percent; in 2004 it was 5.5 percent and in 2005, thanks to the increase in oil taxes and royalties, the deficit was 2.1 percent of GDP. Arce hinted on 11 46

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formally made up before they left Austria, there is little doubt that Chavez’ support provides Bolivia with leverage in its negotiations with its two more powerful neighbours. Venezuela is also signing a financial accord aimed at bolstering Bolivia’s banking and monetary system. According to a project of the People’s Trade Treaty between Bolivia, Venezuela and Cuba, enterprises from all three countries participate with the goal of expanding commerce and sharing technical expertise. CONCLUSIONS Surely, it is time perhaps to start questioning the idea that industrialisation and technology paves the way to democracy and that democratic projects that are different from those of the private sector are authoritarian populism. The news and official reports regularly inform that while worldwide wealth and productivity increases the population, poverty increases as well. We, readers and audience of popular media, are daily invited to think that there is only one way to go: to increase productivity, to spread technology and to allow people to vote. Democracy is at the end of this road. When people vote in a surprising majority for a project (like that of Evo Morales, Hugo Chávez or Hamas), that is not following the predicted path, democracy in danger is debated and the authoritarian use of force is considered as a measure to re-establish democracy. In Latin America, political change is related to changes in the class structure and how the ruling class alliance is exercising its hegemony over society. The usual view is that control of the state, the major centre of political power in regard to both the allocation of society’s productive resources and the coercive power is still of crucial importance for any political or social

May, 2006, that the government would ask the IMF for help in covering the fiscal deficit that is likely to be around US$270m this year.

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movement.49 The pursuit of political power on the basis of political parties and electoral competition has become the normal form of exercising political power. A competing form is the formation of social movements, which unlike political parties, are not organized to pursue power as such, though they are clearly engaged in the struggle over state power. The lessons to be drawn from the Brazilian and Bolivian cases are manifold. First of all, in opposition to classical populism organisations of “self-defence” (or social movements) have become involved in a process of social action and community development. Secondly, these organisations of “selfdefence” representing peasants and Indians have become, together with the labour unions in the cities, highly politicised. They broke with former patterns of clientelistic behaviour vis-àvis political power and the charismatic populist leader. As “reformist” organisations, they want to bring about social change and improvements in the lives of the poor, not the socialist revolution. As “reformists”, their leaders and militants are not seeking confrontation with the power structure or the agencies of political power, but are trying to develop new and additional resources in order to accumulate social capital and skills within the practices and frameworks of the neoliberal social and political model. This brings us to the problem of the electoral road to power and the old Luxemburgist dilemma of “reform or revolution?”50 In other words: should we narrow this strategic question to the problem of the so-called pitfalls of electoralism? The electoral road to power offers some social movements better possibilities for overcoming their internal contradictions and for broadening their audiences. Electoral politics can help reaching other social classes, professional strata or regional 49

José Comblin, Le néolibéralisme. Pensée unique, Paris: L’Harmattan, 2003, p. 165. 50 Atilio Boron, ‘La encrucijada boliviana’, in Rebelión, 28.12.2005.

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interest groups on the base of a common platform. In Latin American countries, mobilisation of social movements representing the interests of ethnic minorities, a landless peasantry and slum dwellers against neoliberal reforms is paying. In several cases they succeeded in defeating neoliberal regimes and in bringing back in power leftist parties using a neopopulist discourse. A contributing factor to their success may be a belated process of economic development that brings about sharp differentiation between the agricultural and the urban proletariat and transforms the urban workers into a privileged class, at least in the eyes of a dispossessed agricultural population. This populism is characterised by a primitive chiliasm that is adverse to dialectical thinking and doctrinal flexibility. It stresses the subjective factor of will over and above the analysis of objective social and economic factors. As a social movement it is voluntaristic by its very nature and resists bureaucratic organisation and routinised modes of action. Finally, it has a tendency to seek solidarities in terms of racial, national, cultural, and primary group identity that is still strong among peasants having recently migrated to the cities or being subjected to the constraints of the international market and Washington’s war on drugs.

MANIFESTO OF THE AMERICAS

We live in a dominant economic system that for centuries has engaged in the unlimited exploitation of all ecosystems and their natural resources. This strategy has generated economic growth and, for some countries, what has been called "development,"

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and has privileged the consumption and well-being of a small fraction of humanity. And, unfortunately, it has excluded the great majority of humanity from access to minimum conditions for survival. The costs of this system of exploitation of nature and of human beings, and of uncontrolled consumerism, has been paid with the sacrifice of millions of poor working people, peasants, indigenous peoples, pastoralists, fisherfolk, and the poorer people in society, who give their lives every single day. And this is accompanied by ongoing aggression against nature, that has been and still is systematically devastating. The integrity and diversity of life forms, which are the basis of biodiversity, are under threat. Nature on our planet is threatened, as is human life, which depends upon nature. Even the Millennium Ecosystem Assessment conducted by the UN, and released in 2005, recognizes that, "human activities are fundamentally and irreversibly changing the diversity of life on planet Earth. These changes will only accelerate in the future." In this important recognition of the planetary crisis, it is critical that we recognize that it is not all human activity that is so damaging, but rather, above all, those actions guided by the uncontrolled drive for profit of transnational corporations. Faced with this dramatic situation, we feel the need to affirm alternatives that can assure a hopeful future for life, for humanity, and for the Earth. We need to pass from an industrial production society, consumerist and individualistic, that sacrifices ecosystems and penalizes human beings, while destroying social and biological diversity, to a society that sustains life. This must be a society in motion toward a life that

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is socially just and ecologically sustainable, and that takes care of the community of life and protects the physio-chemical and ecological bases of support for all living systems, including that of human beings. As inhabitants of the American continent, we are conscious of our universal responsibility. Through us, also, passes the future of the Earth. The Amazonian and Andean countries, for example, like Colombia, Ecuador, Peru, Bolivia, Venezuela and Brazil, are mega-diverse countries. Not just because of the presence of very rich ecosystems, but also because of the many indigenous peoples, peasants, quilombolas and other local communities, that over centuries and millennia have learned to co-exist with biological and cultural diversity. The Amazon forest in our countries makes up a third of all tropical forests in the world, and contains more than 50 percent of the biodiversity. In it there are at least 45,000 species of plants, 1,800 species of butterflies, 150 species of bats, 1,300 species of freshwater fish, 163 species of amphibians, 305 species of reptiles, 311 species of mammals, and 1,000 species of birds. Because of this richness, Latin America is the object of the greed of the "neoliberal global-colonizers," via the action of dozens of transnational corporations, principally companies from the Global North, who are shamelessly engaged in biopiracy. If it once was the race for gold and silver, today it is the race to monopolize genetic and pharmacological resources and the traditional and local knowledge that accompanies them, which have become strategic resources for the future of business in the global market. And they want to impose upon us patent laws and protections for their windfall profits. We want to confront, decisively, this process of exploitation and destruction. We propose consistent policies that:

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1. Conserve the biological and cultural diversity of our ecosystems, including all the living organisms in their habitats, and protect the interdependencies among them, within the dynamic equilibrium that characterizes each ecological region, together with the socially and ecologically sustainable interaction with the peoples that inhabit each region. 2. Guarantee the integrity and beauty of ecosystems, and of the peoples that conserve and depend upon them. This implies preserving the features of ecosystems that assure their functioning and maintain the identity of living beings in their territorial, biological, social, cultural, landscape level, historic and monumental aspects. The preservation of biological and cultural diversity, and of the integrity and beauty of ecological systems, can assure the sustainability of the multiple environmental functions and benefits for human beings today and in future generations. Among these are: clean water, food, medicine, wood, fibre, climate regulation, and flood and disease prevention. At the same time they constitute the basis of recreation, of aesthetics, and of spirituality, while at the same time supporting the soil, photosynthesis, and nutrient cycling, among other vital functions for all of humanity. 3. We oppose, decisively, the introduction of exotic species that are non-adaptive for our ecosystems, as has happened in many biomes with the promotion of homogeneous, industrial plantations of Eucalyptus, pine, etc., that destroy natural ecosystems and have severe, negative social impacts on the peoples that inhabit these areas. What they produce is profit for a few, dollars, cellulose, carbon, polluted water, a degraded environment, and poverty. 4. We strongly oppose the liberation of transgenic organisms in

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the environment, whether in farms, plantations, ranching or whatever other activity in the environment. Beyond being unnecessary, they are essentially useless for anything other than transnational corporate profits. They represent potential risks to human health, and can cause irreversible damage to Nature and ecosystems. We emphatically oppose the introduction of transgenic trees, which represent an even grater danger, because, among other reasons, their pollen can be disseminated over many miles or kilometers, inevitably contaminating other forest species, including native species, and they can have multiple impacts on flora, insects and other components of fauna, and can undercut the basis of the livelihoods of indigenous peoples, fisherfolk, peasants, quilombolas and other local communities. 5. We pledge to combat Terminator seeds because they put life itself -- and its reproduction -- at risk, as they are "suicide seeds" that only benefit the transnational corporations that control our seeds, imposing a position of dependence on farmers. 6. We oppose the attempt of the imperial government of the United States and its transnational corporations to impose the Free Trade Area of the Americas (FTAA) on us, as well as diverse bilateral free trade agreements (FTAs), treaties to protect foreign investment, and agreements adopted in totally undemocratic manners at Summits and in the WTO. These agreements put our Nature, our agriculture, our services, and the living conditions of our populations at greater risk, and only prioritize guarantees in the interest of profits. 7. We express our support for, and recognition of, the peoples and communities who over centuries and millennia have developed our agricultural biodiversity, through the selection and conservation of the seeds that today are the basis of the world's agriculture and of humanity's food supply. To maintain this basis of our sustenance, this enormous richness of

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agricultural and culinary diversity, we must recognize and affirm the rights of peasants, indigenous peoples, pastoralists, fisherfolk, quilombolas and others, to land, territory and to natural resources, so that they can continue to carry out the essential task for humanity of conserving diverse local seed varieties, which can only take place at the local level. We will fight those companies that seek control over our seeds, against the traditions of the peoples who are the stewards of our seeds, who always understood seeds as the source of life, which should never be turned into mere commodities. Finally, we express our hope that these resolutions benefit our peoples and benefit our food sovereignty -- that is, the right of each and every people to produce their own food, in conditions of good health and social justice, and in balance with Nature. We defend those who work in the countryside, our farmers and peasants. We defend their right to live as farmers, and to thusly guarantee the sustenance of our populations. This peasant mode of production contributes decisively to the sustainability of our planet, and to integral, broad-based development, essential for the future of humanity. April 20, 2006 Curitiba, capital of the state of Parana, Brazil, building an America free of GMOs and aggression against the environment. [Translated from Portuguese] 1. Hugo Chávez, President of Venezuela 2. Roberto Requião, Governor of Parana 3. Pérez Esquivel, Nobel Peace Laureate, Argentina

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4. Eduardo Galeano, writer. Uruguay 5. Peter Rosset, food sovereignty researcher. USA/Mexico 6. Pat Mooney, ETC-Group, specialist in the impacts of GMOs and other new technologies, Canada 7. Silvia Ribeiro, researcher ETC-Group, Mexico 8. Noam Chomsky, linguist, MIT, USA 9. Atilio Boron, social scientist, CLACSO, Argentina 10. Violeta Menjivar, Mayor of San Salvador, El Salvador 11. Camille Chalmers, Jubilee South, HAITI 12. Ramon Grosfoguel, Puerto Rico 13. Doris Gutierrez, Congresswomen, Honduras 14. Monica Batoldano, ex-comandante Sandinista. Nicaragua 15. Ernesto Cardenal, poet, priest and ex-minister of culture, Nicaragua 16. Gioconda Belli, poet. Nicaragua 17. Raul Suarez, Baptist pastor and congressman. Cuba 18. Miguel Altieri, professor of agroecology, Univ. California, USA/CHILE 19. Fernando Lugo, Catholic bishop. Paraguay

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20. Blanca Chancoso, Confederation of Indigenous Nationalities, CONAIE - Ecuador 21. Hebe de Bonafini, Mothers of the Plaza de Mayo, Argentina 22. Aníbal Quijano, social scientist, Peru 23. Leonardo Boff, theologian and writer, Brazil 24. Beth Carvalho, cantautora. Brasil 25. Mons. Pedro Casaldaliga, Bishop and poet - Brazil 26. Mons. Ladislau Biernaski, Catholic bishop, Curitiba. Brasil 27. Monja Coen, Buddhist nun, Brazil 28. João Pedro Stedile, leader of MST-Via Campesina-Brazil 29. Temistocles Marcelos Netto. Nat. Sec'ty Environmet, CUT. Brazil 30. Leticia Sabatela, actress, Artists Human Rights Movement, Brazil 31. Nalu Faria, World March of Women, Brazil 32. Pedro Ivo Batista. Eco-socialist Network. Brasil http://www.alainet.org/active/11215&lang=en

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Declaración Final del V Encuentro Hemisférico de Movimientos Sociales, Redes y Organizaciones que luchan contra el ALCA. Declaración Final: Llevar nuestra unidad a niveles superiores

A todos los pueblos de Nuestra América A la opinión pública nacional e internacional En abril del año pasado, el IV Encuentro Hemisférico de Lucha contra el ALCA que celebramos aquí mismo en La Habana, nos convocó a los movimientos sociales de todo el continente a unirnos en la realización de la III Cumbre de los Pueblos para encarar la nueva Cumbre Presidencial de las Américas a realizarse en Mar del Plata. Allí, las jornadas de resistencia popular, unidas a la voluntad política de algunos gobiernos, consiguieron bloquear la agenda del Gobierno de los Estados Unidos y el intento de revivir el Área de Libre Comercio para las Américas (ALCA). De esta manera, el proyecto hegemonista norteamericano sufrió una nueva derrota y ha quedado paralizado. La campaña continental contra el ALCA brindó un significativo aporte en esta batalla. Hemos mostrado así la capacidad de los movimientos sociales para hacer realidad las acciones que nos proponemos. En este V Encuentro, las delegadas y los delegados representantes de diferentes redes y campañas continentales, al mismo tiempo que celebramos esta victoria, reafirmamos

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nuestro compromiso por continuar luchando contra el libre comercio en todas sus expresiones. Esta lucha tiene hoy día un escenario decisivo en el enfrentamiento a las negociaciones y firmas de Tratados de Libre Comercio (TLCs) en varios países del continente. Resaltan las resistencias de los pueblos de Ecuador, Perú y Costa Rica que han logrado trabar esas negociaciones. Igualmente denunciamos y nos oponemos activamente a la Organización Mundial del Comercio (OMC), institución que generan las normativas y definen las políticas del libre comercio en el mundo, donde se hace avanzar la agenda de las trasnacionales en contra de los intereses de los pueblos. Por otro lado, denunciamos y combatimos el resurgimiento del neocolonialismo europeo en su tentativa de imponer tratados de libre comercio como parte de una agenda neoliberal en nuestra región que favorece exclusivamente a sus trasnacionales. El libre comercio y la acción de las transnacionales están homologando hacia abajo las condiciones laborales en todo el mundo, fomentando la competencia entre trabajadores y trabajadoras norte- sur y sur – sur para ver quien trabaja más por menos. Tenemos que fortalecer la solidaridad entre los trabajadores como única forma de romper este chantaje. En general estamos ante un ascenso de la resistencia popular en América Latina contra estas políticas. Inclusive en los Estados Unidos se ha despertado una ola de movilizaciones masivas de los emigrantes que se enfrentan al intento de criminalizarlos y acentuar la discriminación de que son víctimas, y por defender sus derechos civiles y laborales, en definitiva sus derechos como seres humanos. La migración a la que se están viendo obligados grandes grupos de población en

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todo el continente es consecuencia del modelo económico neoliberal y de libre comercio que padecemos todos. La reivindicación de sus derechos es también nuestra reivindicación, de todos y todas, por una sociedad más justa económica y socialmente en las Américas. Este ascenso de las luchas populares está permitiendo en América Latina la llegada de gobiernos surgidos de plataformas políticas que tratan de oponerse a la hegemonía de Estados Unidos, lo que contribuye al cambio de la correlación de fuerzas que favorece la oposición al consenso de Washington. Esto nos sitúa en un nuevo escenario donde existen mejores condiciones para, junto a la resistencia a los planes del imperialismo, avanzar en la construcción de alternativas cada vez más viables. Para ello, debemos estar abiertos a un diálogo fructífero, en pie de igualdad y respeto, entre los movimientos sociales y aquellos gobiernos que estén verdaderamente comprometidos con los intereses populares. Hoy se viene desarrollando ya la Alternativa Bolivariana para las Américas (ALBA), promovida por Venezuela y Cuba, que se viene concretando en importantes proyectos como la operación Milagro, los programas de alfabetización en varios países del continente y acuerdos como el de Petrocaribe. Así mismo ha surgido la iniciativa de los Tratados de Comercio de los Pueblos (TCP) impulsados por el presidente boliviano Evo Morales (participante de nuestros anteriores encuentros). Tales alternativas de integración, deben contar cada vez más con los aportes de los movimientos sociales. En esta construcción de alternativas concretas destaca la importancia del tema de la energía como uno de los ejes de los procesos de integración. Todos estos temas serán la materia de

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nuestro trabajo durante la próxima “Cumbre Social por la Integración de los Pueblos”, que realizaremos en Santa Cruz, Bolivia, durante el próximo mes de septiembre. En la búsqueda de alternativas no puede estar ausente la necesidad ineludible de acabar con el flagelo de la deuda externa que es usado por las grandes potencias e instituciones financieras internacionales como un instrumento de chantaje para “disciplinar” a nuestros países. Debe prevalecer la idea justa de que somos acreedores y no deudores. Estos nuevos escenarios significan una nueva etapa, en la que los movimientos sociales debemos pensarnos más a la ofensiva, y que a la vez nos exige reforzar la articulación y cohesión de nuestras acciones. Debemos lograr no sólo identificar la agenda que nos resulta común sino además integrar las diversas agendas nacionales y sectoriales como espacios reconocidos también de lucha de todos y todas. La agenda del movimiento social frente a los nuevos retos y escenarios es muy amplia y diversa. Nuestros objetivos contemplan la lucha contra el neoliberalismo en todas sus expresiones e incluye la superación de la cultura patriarcal y las diferentes formas de discriminación por género, identidad y orientación sexual; contra mujeres, jóvenes, pobres, indígenas, afrodescendientes e inmigrantes. Dentro de estos objetivos la dimensión jurídica ocupa un papel importante en la defensa de los derechos fundamentales de la humanidad. Asimismo la defensa de la naturaleza y la biodiversidad, los recursos genéticos y el conocimiento popular son parte esencial a nuestra resistencia a la destrucción neoliberal. Defender la tierra y democratizar su propiedad, impulsar la reforma agraria, así como garantizar la soberanía alimentaria, constituyen componentes básicos de nuestra agenda. En este terreno es

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necesario continuar impulsando y defendiendo la economía solidaria y la producción local sustentable. La resistencia a la ofensiva de las corporaciones trasnacionales por privatizar los recursos estratégicos de las naciones y mercantilizar derechos públicos básicos como la educación, la salud y la seguridad social, y sobre todo hoy el vital derecho al agua, seguirá siendo un motor de nuestras acciones comunes, así como la defensa de las culturas e identidades de nuestras naciones. Las luchas estudiantiles a democratización de las universidades y contra la mercantilización de la educación, , constituyen expresiones de enorme importancia en estos empeños. Asumimos la defensa de estas luchas que están siendo blancos de la acción de las fuerzas represivas. Un eje central de nuestra acción es el combate contra la militarización y la política de “seguridad” del gobierno de los Estados Unidos que está asumiendo formas graves de expresión en nuestra región. Ese gobierno impulsa una visión que mezcla argumentos de combate a la piratería, al lavado de dinero, al narcotráfico, al terrorismo internacional, al contrabando, etc. que busca en realidad someter las políticas de seguridad de los gobiernos de nuestros países a una orientación y comando definidos en Washington. Esto es lo que está en curso, por ejemplo, en el Plan Colombia y el Plan Patriota, en la Triple Frontera (Argentina, Brasil, Paraguay) y en la implementación del TLC plus, conocido como Alianza para la seguridad y la prosperidad de América del norte (ASPAN). El guerrerismo de la administración Bush está provocando el incremento de las acciones intervencionistas en nuestros países, sobre todo en aquellos donde los sectores populares comienzan a

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tener sus mayores éxitos. Particularmente amenazados están hoy Cuba, Venezuela y Bolivia. Nos declaramos en alerta permanente para oponer con toda energía nuestro potencial movilizador y de combate frente a tales acciones. Convertiremos cada agresión en un nuevo “playa Girón”, esto lo proclamamos en el 45 aniversario de aquella victoria frente al imperialismo Yankee. En el combate contra la dominación imperialista, el colonialismo y el neoliberalismo no se nos escapa que lo fundamental es ganar la guerra por la conciencia de la gente, librar la batalla de las ideas. En esa tarea es particularmente importante vincular el pensamiento de los intelectuales a las propuestas de los movimientos sociales en la lucha por la emancipación de la humanidad. Y ganar la conciencia de la gente pasa necesariamente por construir visiones y alternativas en los ámbitos de la comunicación, la información, la educación y la cultura que logren contrarrestar los aparatos y mecanismos que están al servicio del pensamiento hegemónico. Frenar la imposición de leyes que reducen cada vez más los espacios democráticos de ejercicio de la comunicación y que intentan, monopolizando el espectro radioeléctrico entre otras acciones, ahogar a los medios de comunicación alternativos, como por ejemplo está sucediendo en México, es una tarea impostergable en la agenda de todo el movimiento social. Las redes, campañas y movimientos sociales de todo el continente americano salimos de este V Encuentro con la firme decisión de que es indispensable llevar nuestra unidad de pensamiento y acción a niveles superiores que estén a la altura de las amenazas y desafíos que encaramos tanto en la resistencia como en la construcción y defensa de nuestras alternativas. La tarea de continuar abriendo nuevos horizontes comienza desde hoy mismo.

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Nos reencontraremos en La Habana, los próximos 3 a 5 de mayo de 2007, en el “VI Encuentro Hemisférico de movimientos y redes que luchan contra el ALCA y el libre comercio”. Otra América es posible La Habana, Cuba, 15 de Abril de 2006 http://www.alainet.org/active/show_text.php3?key=11150

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