Weisbrot on the Morales election

I think Mark's right on here (excerpted below).

I'll add my two-bits as well. If you want to understand what's happening in South America, you have to look past typical Cold War polarizations, and the American government's utter lack of ideological agility and the easy categories based in largely defunct political economics that it uses to map Western hemispheric geopolitics. There is indeed a deceptive revolutionary rhetoric resounding from the South. But it's based in a certain reality, which is simply that, when faced with empirical realities that suggest economic failures, it's difficult to listen to someone tell you that you haven't gone far enough.

A lot of people are guilty in the North and the South of looking at the leftward changes in Latin American politics through the old-timey lenses. Chavez himself allegedly gives a close ear to 1960's European leftwing ideologues, and his own rhetoric and friendship with Castro makes it easy for the North to scapegoat him as another Castro-lite. But there are serious people in that government working on serious issues and looking at alternatives to the ideology of liberalization as well as to strict forms of socialism. I often found, while in Venezuela a few months ago, that my proposals to look to the Scandinavian countries (especially the parallel with Norway and its oil wealth; but also Finland and its global competitiveness) for lessons in balancing experimental democracy with a strong social justice program and a healthy economy were met with the most agreement regarding what they were trying to do. But on their own terms, given local and regional contingencies [UPDATE: see here in Sunday's WaPo on one of the key regional plans].

The North understands Venezuela and Bolivia largely as socialist throwbacks. Through American self-interest, the US despises the move against privatization of national resources. But the US needs its own dose of economic and political reform, and no longer seems to have the imagination to understand itself let alone other countries trying to find new and better directions for their own societies (what the hell are we doing with Nixon and Ford administration figures trying the same old tricks?). Some honesty, transparency, and imagination here - though it will never be forthcoming from the present administration - could help matters all around.

...But we would do well to step back from the politics for a moment and look at this election in economic terms. This explains a lot what is happening in Bolivia, and indeed across most of the region. Bolivia is the poorest country in South America -- its GDP (or annual income) per person is only $2,800, as compared to $8,200 for the Latin American region and $42,000 in the United States.

Bolivia has also been subject to IMF agreements almost continuously (except for eight months) since 1986. And it has done what the experts from Washington have wanted, including privatizing nearly everything that could be sold. Among the most notorious was the water system of Cochabamba, which led to the famous "water war" against Bechtel (the buyer) in 1999-2000 after many residents got priced out of the market. The country's Social Security system was also privatized.

But nearly 20 years of these structural reforms -- or "neoliberalism" as Morales and most Latin Americans call it -- have brought little in the way of economic benefits to the average Bolivian. Amazingly, the country's per capita income is actually lower today than it was 25 years ago. And 63 percent of Bolivians live below the poverty line.

So Morales' declarations cannot be dismissed as just populist campaign rhetoric. In fact, the economic failure of the last 25 years is both regional and unprecedented. For Latin America as a whole, income per person -- the most basic number that economists have to measure economic progress -- has grown by about 1 percent for the first five years of this decade. From 1980 to 2000, it grew by only 9 percent. Compare that to 82 percent for the 1960-1980 period -- before most of the neoliberal reforms began -- and it is easy to see that this is the worst long-term economic failure in modern Latin American history.

Here in Washington, most economists and policymakers have either ignored this profound regional economic failure or maintain that is has nothing to do with the structural reforms of the last 25 years. On the contrary, they argue that the reforms did not go far enough -- and that is the position of the Bush administration as well.

But most Latin Americans aren't buying it. This difference over economic policy -- much more than drug policy, the war in Iraq, immigration, or Cuba -- is the main thing that has set Washington on a collision course with most of Latin America. Evo Morales is now the sixth candidate in the last seven years to win a presidential race while campaigning explicitly against "neoliberalism." The others were in Argentina, Brazil, Venezuela, Ecuador and Uruguay. And there will likely be more in the near future, as there are 10 more presidential elections scheduled in Latin America over the next year....

...At some point Washington policymakers and economists will revisit the economic evidence and decide that perhaps some of their policy prescriptions have been wrong. But by that time, Latin America will have long passed them by.