The IUSB Vision Weblog

The way to crush the middle class is to grind them between the millstones of taxation and inflation. – Vladimir Lenin

Latin America Turning “Red” with Anger

Posted by iusbvision on March 21, 2007

Motivated by nationalistic pride, a sense of economic exclusion, and even anti-USA sentiment, a handful of South American countries are experiencing a dramatic political shift towards the left. Feeling disenfranchised by years of domination by rightist regimes, voters have granted an unprecedented mandate to these elected leftist leaders to veer their countries towards economic and social development.

The Tale of Two Lefts

Perhaps the strength of these new leaders lies on their ability to adapt the socialist model of their platforms to their own national conditions. In a continent of such cultural diversity and differences, the traits of a one-size-fits-all socialist doctrine simply cannot apply — if it aims at governing with at least minimal consensus. In an effort to garner this consensus, some regimes are being forced to appeal to the opposition for help, and the rate of compromising under which a leftist government is willing to operate has created a virtual socialist divide. On one side, moderate socialists like Chile’s Michelle Brachelet and Brazil’s Luis Inácio Lula da Silva have sought support from social democrats and right-centrists in their rise to power. On another, radical populists like Bolivia’s Evo Morales and Venezuela’s Hugo Chavez have banked on the discontent of the poor and downtrodden and their disdain for the elitist rich to solidify their leadership. While the ties that bind these regimes together are certainly pro-social reform, pro-education, and in favor of administering and controlling their natural resources, there are palpable differences between them.

The Centrist Approach

Still healing the wounds of Generalissimo Augusto Pinochet’s tyrannical and oppressive 17-year reign of terror, Chile elected left-centrist Michelle Brachelet to the country’s highest office. The first woman to ever ascend to that post, Brachelet defeated rightist billionaire businessman Sebastián Piñera in the 2006 presidential election runoff, and did so under the auspices of a coalition that included parties with very distinct political inclinations — albeit socialist in essence — like the Christian Democratic Party and the Social Democrat Radical Party. Promising widespread educational reform, better distribution of wealth, and free health care for the elderly, Brachelet has remained loyal to the socialist ideal that has been a part of her family since it was sent to exile following Pinochet’s coup d’état. Nevertheless, her support of free trade markets has drawn criticism from sectors of the economy and from fellow socialist presidents. As it stands, President Brachelet’s challenges run the gamut of socio-economical issues that oppress most of South America. Her success will reside on her ability to mobilize not only her opposing parties, but also the country as a whole.

Elected to the presidency of the largest Latin American nation in 2002 after three unsuccessful attempts, Brazil’s Luis Inácio Lula da Silva inherited the reins of a country disillusioned by four consecutive right and right-centrist governments that did a formidable job at steering the country away from military dictatorship, but did very little to resolve the ever-growing problem of social disparity. A former press operator who lost one of the fingers in his left hand while operating a lathe, President Lula ascended to power as ‘the candidate of the poor with a rhetoric marked by populist discourse and inflamed accusations against “the elites”. However, President Lula has quickly realized the difference between telling how things should be done and actually doing them: his promises of a clean and lean government have yet to be fulfilled, and he has been both praised and vilified by his constant reaching out to centrists in order to further his domestic policies. The Worker’s Party, the political entity that catapulted Lula into political prominence, has struggled with political scandals and accusations of betraying the ideals that made it a favorite with the poor. While Lula’s attempts at rallying both the left and the right around his plans for social reform are praiseworthy, the reluctance he has encountered from within his own party may pose as one of his greatest obstacles. And in the meantime, Brazil continues to be a country of contrasts and dichotomies: while it possesses the 10th largest GDP, no other country in the planet shows a more abysmal chasm between the “haves” and “have-nots”. Coupled with a stagnant economy — 2006 economic growth was second-to-last in all Latin America — President Lula will have to maneuver the country and the government machine with great resolve if he plans to leave any lasting impact in Brazil’s ability of overcoming its many woes.

Populist Demagogy

One of the poorest countries in Latin America, Bolivia became the latest entrant in the arena of socialist-bent nations when it elected Evo Morales to the presidency in 2005. Proclaiming himself the first-ever person of indigenous descent to become president (despite being himself a mestizo), the former coca farmer gained the support of other radical socialists such as Hugo Chavez and Fidel Castro almost immediately when he fostered a nationalistic and populist approach in his presidential campaigning. This aroused the interest of voters in this mostly native nation and he won the 2005 election with an absolute majority of the votes. Despite a vast wealth of natural resources, especially hydrocarbons and natural gas, Bolivia has suffered through decades of rampant inflation and poverty caused by foreign exploitation and domestic corruption. As one of the first measures as newly-elected president, Morales made good of his promise to re-nationalize Bolivia’s natural resources by placing national troops inside all major foreign natural gas refineries while demanding re-negotiations in natural gas exploration contracts. Ironically, this measure placed President Morales at odds with yet another pro-leftist government: as Bolivia’s largest natural gas customer, Brazil’s state-owned Petrobrás saw several of its own Bolivian operating installations seized by the Morales regime and created a momentary impasse in the relations between both countries. Whether Morales initiatives to expropriate the exploration of natural gas will be advantageous to Bolivia in the long run, the decision to regain control of the nation’s natural gas production played squarely into Morales’ efforts to appeal to the indigenous part of the population, who for years suffered with misrepresentation and disenfranchisement.

No other figure in the current Latin American political sphere is as controversial as Venezuela’s Hugo Chavez. Both persuasive and incendiary in his rhetoric, Chavez is a cunning, persuasive orator who masterfully orchestrates the media to further his socialist political agenda and to rally Venezuelans around his “anti-imperialist” discourse. His weekly TV talk show entitled Aló Presidente (think of a televised Fireside Chats to the sound of merengue while imbibing on aguardiente), his constant photo-ops with the likes of Iranian president Mahmoud Ahmadinejad and Cindy Sheehan, and his regular condescending remarks towards President Bush and American foreign policy has placed him in a position of both admiration in infamy depending on who you ask. His admirers hail him as a liberator who will usher Venezuela to an era of economic self-sufficiency and progress. His detractors vilify him as a demagogue and Castrist communist who will eventually lead Venezuela into authoritarianism. Whatever the case may be, one thing cannot be denied: his skills as a politician have granted him some unique powers for a democratically elected president (he has campaigned in favor of allowing presidents to be reelected indefinitely, and in January of 2007 the Venezuelan congress has approved an act giving him the power to rule by decree for 18 months.). His landslide reelection in 2006 granted him a mandate and he plans to exercise this mandate while setting forth even more radical measures towards turning Venezuela into a de facto socialist country.

Overall, this shift towards the left is symbolic of a South American populace that has grown increasingly restless through years of rightist regimes that promised raising the standards of living and improved social policies but left them marred under what is widely perceived as the subjugation of capitalism — personified by U.S. foreign policy. Discontent ushers change, and in that aspect, this move towards socialism was almost inevitable. It is noteworthy that this shift has occurred by means of suffrage rather than arms, and this speaks volumes about the type of popular support enjoyed by these leftist regimes. In a region that is characterized by extremes — extreme poverty, extreme social inequality, extreme wealth imbalance — it was only a matter of time until these issues came to a head. South America is a hotbed emergent market, which will continue to attract foreign investment in various sectors of their economy. Whether these socialist regimes, radical or otherwise, will be able to capitalize on this emergence for the common good remains to be seen.

Ed Hellig

6 Responses to “Latin America Turning “Red” with Anger”

  1. Many people in this post Soviet Union era we live in routinely criticize the former nation for some alleged crimes there government may or may not have committed, depending on who you talk to. Many people, especially old guard conservative like to point out that “capitalism and democracy have defeated tyranny and terror. But now that it has been more than 15 years since the fall of the Soviet Union, how much better is the world now that this once mighty nation has fallen. Have these so called “defenders of freedom” of the neo conservative ranks really taken the world in a better place than it was before the “horrible” and what Ronald Reagan called “the evil empire” Perhaps it is time to take a look at our own system, and how we do things in this country. Are capitalism and democracy actually compatible? Or does one survive at the detriment of the other. Let’s look at each and explain this.
    Many people believe that capitalism and democracy are actually very different, and cannot really coexist at all. In its perfect form, democracy is the idea that people should have control over their own lives, and power should never be centralized in the hands of a few people. But isn’t that what has the potential of happening precisely because of capitalism.
    In most western societies, especially the United States, we like to say that we live in a democratic society, and while this may be true to some extent, although the argument can be made that how much of a say do we really have in such a bloated bureaucracy, but to say that we have a democracy is another point all together different. Representation in the halls of government is considered by many to be only one element of our lives, and maybe even one of the lest important. It is by far the economic systems that a nation adopts that has far more effective control over our lives, because the economic systems decides who controls what in a society, who has to work and who doesn’t, and ultimately, how we interact with each other, not just in our own nation, but how we react with other nations as well. It could also be argued that capitalism is one of the least democratic institutions in the world because in a democratic economy, each member of that society would have a say in how much work is done and how those resources are spent and utilized. But in a capitalistic economy like that in the United States, everyone, the private and public sector, is competing for these resources, and in the end, those resources will end up in the hands of the powerful few. Since people must have money to live, they must work for those people who will then decide who will work, how long they will work, and how much they will be paid. Those powerful few also get to decide the social and economic makeup of the society, as well as what people will read about or hear about in the news because they control the media because they have the resources to do so. Because of the tight control people have in a free market system, no one is truly free to pursue their own interests, happiness and dreams, because they are all inevitably at the mercy of the capitalists system.

    But most of what I have said above really pertains to middle class people in America, not necessarily the so called “working poor” or people who are only one layoff from financial ruin. What happens to this silent majority in the capitalist system? Every person in a society has two things by which they may barter with to get things and to survive; these things are time and creative energy. But for the poorest amongst us, sometimes, most of the time, this is all they have. They have no wealth to speak of, and they must barter these precious commodities just to survive. When a person is forced to do this, they are forced to sell parts of their lives just to survive, and people will spend their lives searching out things for which they can be paid for just to survive, instead of being able to do what your heart and mind tells you to do, instead of doing what you may be good at, or perhaps following your dreams, and doing something you have always wanted to do. This is the price of capitalism, and it is wrong. A terrible irony of this vicious cycle is that when you go to the market to buy essentials that you need to survive, you must buy back the very goods you or someone you know may of helped produce at a profit. But a greater commodity is lost forever, the time you gave up to your employer, and all you have to show for it is the telephone bill or the electric bill you were able to pay this week.

    We as human being must learn how to escape the clutches of competition, we should learn how to develop a economy that is not based who can get the most goodies, but on giving to those less fortunate than we, make a world in which a person could do what they wanted with their life, and give to others as they were most qualified to do. We must do away with the fear of going hungry, and the ability to do things and have things would shared by all, instead of being held by a few. People who want to write books should be able to write books, people who want to draw or paint, should be able to do these things. The dirty work that no one wanted to do would be spread around so everyone took a turn in the labor, and no one would be just a number to some big corporation, whose very life and existence were meaningless too.

    To some, this may sound like just a pie in the sky fantasy, while I must admit, it is just a dream, but that doesn’t mean that we cant all work together to make each others lives better than they are now. And we don’t have to look far to find examples of how much better life is when there is not a price on everything, look only to the local quilting bee, who gathers once a week to share advice and stories, or the campers, who come together to share food or maybe just a cup of coffee, or even the people who come together to share stories or ideas about something that is really bothering them, these are all example of what can happen when we don’t put a price on everything in a society.

    We are often told that it is just the basic instincts of humans to compete and be greedy, and that is the way it has always been. But the very existence of other cultures and civilizations says this is not true. Capitalism is a relatively new concept, and many other have existed for much longer than capitalism, and have fared much better. People’s values and believes are learned from the environment that they grow up in, and we now to some extent have the power to make up our own environment to which we wish to live. Also, because we live in such a materialistic and much more increasingly violent world, we may be chased by feelings of greed or aggression. But if we are raised in the right environment, we could be taught or trained to interact with each other in ways that would be much more appealing to everyone. Is it not possible for people to give more freely to each other if we didn’t have to give a part of yourself away in order just to survive?

  2. Rachel Custer said

    Tammy,

    First of all, I want to say welcome to the weblog and thank you for your comments. Your view sounds good at the first, but I would like to point out that several societies have tried to build a new way of living using these very principles, and have become some of the most ruthless, poverty-stricken, murderous dictatorships in human history. A picture of communism as not concentrating wealth and power in the hands of the few is erroneous. Communism, which is basically what you are espousing, has, throughout history, always looked better on paper than it turns out to be in practice.

    That being said, I do think it is terrible that some people have to live in extreme poverty, and I think we, as a capitalist society, could and should do a better job of helping our poor. But history has shown that, while capitalism is far from perfect, communism, without historical exception, is far worse.

  3. Tammy Reynolds said

    Rachel,

    You missed my point. I was trying to say that a governmental system, while important, is not the most important thing to most citizens. It is economics. My point was that capitalism and democracy dont coincide with each other.

  4. Rachel Custer said

    Tammy,

    I agree that economics certainly affects people’s lives greatly. Democracy is a form of government that emphasizes personal freedom and rule by the citizens. Capitalism is an economic system that emphasizes personal freedom, responsibility and choice. It seems to me to coincide quite well with democracy, seeing as we are the most rich and powerful nation on the face of the earth. Poverty is despicable, but even our poor are the richest poor in the world. Because of our political, intellectual and personal freedoms, we have an innovative entrepreneurial spirit that other nations have had difficulty maintaining as their politics and economic systems move toward the left.

    What economic system do you feel would coincide better with democracy?

  5. Craig Chamberlin said

    Tammy,

    I enjoyed your post, it was both well thought out and clear in its point. I have a few ideas to throw at you as food for thought. I will agree that unexpected oppression indeed exists as a result of our system and expected oppression will clearly exist as a result of the alternatives. However, I think your frame of frustration is pointed at the way things should be rather than what they really are. This is not meant in a condescending way, rather in a constructive way. Let me explain.

    You argue that a society should exist where individuals do not thrive on the obtaining of valuables and goods. This I will agree with you on. However, since the beginning of time this is the way people really are. What we have is a system that attempts to take advantage of what people are naturally inclined to do (respond to incentives) and build an economic system off of it. I am not suggesting it is good that individuals strive for material goods, however, striving for material goods and having an opportunity to work for them is the drive that has always existed.

    If we instead create a system that forces individuals to not act in the way they really are (responding to incentives). Then we undermine freedom and create only selfishness. In this, I am suggesting it is the truth that if you force one person to be giving, they will probably never truly be giving.

    Unfortunately, as you have illustrated, the complete dedication for striving for material goods can lead to both greed and corruption. This, however, points at a deeper problem than simple flaws in the capitalistic system. Our society has embraced the “me philosophy”, and as a result – the system is moving in that direction. The solution, however, is not to change the system, rather to change the hearts of the people who are involved in the system. People will always respond to financial incentives, and it is shown that all of the other systems simply do not work. Any good economist will tell you, “This is our system only because it’s the best we’ve come up yet. The other systems simply do not work” and this is rightly so. The key word in the capitalistic philosophy is incentives. Let me explain further.

    The incentives have changed dramatically over the years. The question becomes, just what is each individual striving for? If each individual were striving for the betterment of American in their contribution to capitalism, would it not result in a completely different kind of America? Perhaps it is important to think about this for awhile. Incentives, however, are currently for self-fulfillment. Yet, you suggest this is a result of the system, I suggest it is a result of poor moral framework and education. We no longer realize the impacts of our daily incentives and how it affects the bigger picture.

    Unfortunately, as a result, the government has attempted to create programs that end up with the opposite effect of their purpose. As I had said, if you force people to be moral, they will probably hate your morals. If we force people to help the poor, they will no longer help the poor. The typical response becomes, “Just what am I giving 40% of my wages too once a year?” Forced morality begets anger, frustration and contempt for those who are both doing the forcing and those in which they are forced to help.

    But don’t you see? If the system is not capitalistic, and does not allow for people to choose to be giving and have their incentives based on the good of the nation, then there can be only one other system. Our only other alternative is forced equality (Communism and Socialism) – oppression then becomes universal and it no longer has any true value because people do not understand why they have to give up everything for others. “But this is common sense” you may argue, and this is rightly so… however, it becomes less clear when a man comes knocking on your door and tells you. “There are people who are poor, so give us your money so we can give it to them.”

    “But I don’t know who these people are.” you will respond

    “It doesn’t matter who they are, we’ve determined that they need your money.”

    “Can I not determine that for myself?” you will ask.

    “We gave you that opportunity, and you failed to be giving, now we have no choice but to take that choice from you.” they will respond.

    This, in effect, is where the system is heading. It is a vicious cycle. We are forced to give because we are not giving, and many are not giving because they are forced to give. We are both guilty. Anyways, your post very much peaked my curiosity… I enjoyed it :).

    – Craig Chamberlin

  6. Chuck Norton said

    Tammy said,

    “My point was that capitalism and democracy don’t coincide with each other.”

    This is a staple of communist/marxist/neo-marxist propaganda. Freedom does not come about through central control of the economy. Marxist theories are a defective product that have failed miserably when applied. When academia preaches that intellectual lightweights like the neo-marxist C. Wright Mills are the godfathers of good social science, nonsense like the above is what you get. Reality doesn’t even enter into it.

    Tammy said,

    “We as human being must learn how to escape the clutches of competition”

    Ok you computer people, how good would Intel processors be if there was no AMD?

    This is the problem, when people like Tammy fail to achieve their utopia through central control and government monopolies, history shows that they will use force or violence to achieve utopia because those pesky dissenters keep doing what is natural and engaging in competition and capital ventures. …… The end result is oppression, poverty, and mass murder. Purge anyone?

    This is why those who oppose(d) Hugo Chavez, Che Guevara, Castro, Pol Pot, Stalin, Lenin etc etc etc etc have/had a tendency to disappear.

    Is it a coincidence that the same people who hold authoritarian political views like Tammy, also oppose the victory of the United States in times of war. It is the United States that stands in the way of their agenda of central control.

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