By Tom Gibb
BBC News, Buenos Aires
December 28, 2005
The workers of the San Justo glassworks in Buenos Aires never thought about owning their company, until it went bankrupt four years ago.
It was just one of thousands of businesses that sank as Argentina's once prosperous economy went into meltdown, pushing almost half the population below the poverty line.
Today a new furnace where the red hot glass is melted is burning. The factory is one of more than 100 "recovered businesses" which are now putting themselves forward as an alternative business model for the country.
When the factory went bankrupt, a group of the workers faced with losing their jobs barricaded the factory gates for almost a year to stop the machinery being taken away.
They slept under canvas through the worst of the winter, while a lawyer argued their case in court.
The hardest thing was that many of their families, who did not have enough to eat, did not support the venture.
"We had to fight with our families, who did not believe in this. They would tell us to go find a job," says Leonicio Eloy Arias, who has worked at the factory for more than 20 years.
The workers claimed in court that because they had not been paid for months, they should have first right to the machinery and factory site.
Eventually, a judge gave them permission to restart the furnaces.
Today the 38 workers at the glassworks are once again making glass car headlights, exporting these as spare parts to other countries in South America.
They have managed to make enough profit to reinvest some of it in new machinery. And they earn about $500 a month, a good wage for Argentina and one that equals the best period when the factory was in private hands.
'Valiant'
The factory is not an isolated success.
The National Movement of Recovered Factories boasts more than 100 businesses that went bankrupt during the crisis, but are now up and running, employing some 10,000 people.
Not all of these are factories.
They include a hotel, a meat-processing plant which exports beef to Europe, a hospital and one of the oldest shipyards in the country.
The Astilleros Navales Unidos, stands at the entrance to the system of waterways that snakes from Buenos Aires for thousands of kilometres all the way to Paraguay in the heart of South America.
While a few take-overs have had to fight lengthy battles with former owners, at the shipyard they have received full support.
"It was very hard for me to close my business," says former owner Raul Podetti.
"It was my entire life's work. But now I have the pleasure of seeing it reborn. What the workers have done is valiant. They deserve support."
However he adds that he is doubtful whether the workers-run factories will be able to operate as efficiently as private companies and so build an alternative business model.
New law
Since the workers took over, the shipyard has had little business, because it still does not have legal recognition to the land, making it difficult to get long term orders.
The workers survive from refitting riverboats. But for them it is profitable.
"Because workers need only something to take home, normal economic theory does not apply," says Luis Caro, the lawyer who represents the movement.
Everyone in the recovered businesses gets paid the same, and decisions are taken through meetings of all the members.
"Internal agreement is the key to success," he says.
Luis Caro has written a new bankruptcy law, now going through Argentina's congress, which would make it much easier for workers to take over factories that go bankrupt.
It has already been passed by the lower house and is awaiting approval by the senate.
If the law passes Luis Caro says he hopes many more of the factories closed down during the crisis may be reopened.
Thursday, December 29, 2005
Foreign Policy Fantasies about Venezuela
By Mark Weisbrot
From: TPMCafe Special Guests
Thanks to Josh Eidelson for pointing out some of the flaws in Foreign Policy's latest (January/February 2006) cover story, "Hugo Boss: "How Chavez is refashioning dictatorship for a democratic age." The article is much worse than Eidelson describes it, as will be seen below. The idea that Venezuela is a dictatorship is absurd, as anyone who has been there in the last six years can attest to. All you have to do is go there, turn on the TV and listen to denunciations of the government on the biggest TV stations, pick up the biggest newspapers and see the same - in fact the media plays a non-journalistic oppositional role in politics that would not be allowed in most European democracies. Even in the United States, the long-lapsed Fairness Doctrine would quickly be brought back, if our media ever got to one-tenth the level of partisan political activity exhibited by Venezuela's major broadcast and print media, which make Fox news look impeccably "fair and balanced" by comparison.
Let me correct one error in Eidelson's description, which he may have gotten from the Foreign Policy article, before proceeding: the government of Venezuela has not been "keeping public databases on citizens' votes." All voting is by secret ballot in Venezuela, and there is no record anywhere of any individual's vote. What he might be referring to is the names of people who signed a petition to recall President Chavez in 2004. These petitions are a matter of public record, as similar petitions generally are in the United States; and in fact not only the government, but Sumate, the U.S.-funded opposition group that organized the recall effort, also kept a record of these signers. A legislator subsequently made the names of signers public, causing considerable controversy.
Now for some of the mistakes in the Foreign Policy piece by Javier Corrales:
"Chavez is "now approaching a decade in office." [p.33] Hugo Chavez took office in February of 1999. I have never seen anyone round up to 10 from a number just under 7. Perhaps the subtitle of this article should have been "Refashioning Arithmetic for an Innumerate Age."
"the poor do not support him [Chavez] en masse." [p.35] This can be refuted by any recent poll, as well as by opposition pollsters themselves. Chavez' recent approval ratings have ranged from 65 to 77 percent. Where does this support come from? The upper classes? Perhaps this is another arithmetic problem. Also, a look at the results of the August 2004 referendum, which Chavez won by 59-41 percent, shows one of the most polarized voting patterns in the hemisphere, with poor areas voting overwhelmingly for Chavez and the richer areas voting overwhelmingly against him.
"Chavez has failed to improve any meaningful measure of poverty, education, and equity." [p.35]As I noted in a prior post, the official poverty rate now stands at 38.5 percent, but that counts only cash income. For example, if the United States were to abolish food stamps and Medicaid, poor people here would be much worse off. Similarly, the subsidized food and free health care now available in Venezuela have significantly increased living standards among the poor. More than 40 percent of the country buys subsidized food, and millions of poor people have access to free health care that was previously unavailable. If these are taken into account, the measured poverty rate would drop well below 30 percent.
The poverty rate when Chavez took office, in the first quarter of 1999, was 42.8 percent. So there is a meaningful measure of poverty reduction, especially if non-cash benefits are taken into account. Also, the government declared in October that 1.48 million Venezuelans have been taught to read as a result of a massive literacy drive that began in 2003. Although there is so far no independent verification of the number, even if it turned out to be significantly overestimated, there is no doubt that a very large number of Venezuelans (total population: 25 million) have learned to read under the program.
"Following the 2004 recall referendum, in which Chavez won 58 percent of the vote, the opposition fell into a coma, shocked not so much by the results as by the ease with which international observers condoned the Electoral Council's flimsy audit of the results." [p. 39] Actually, according to all news reports at the time, they were shocked by the results; they announced that the referendum was stolen, and most of the opposition continues to maintain this position. There was nothing "flimsy" about the audit, and there is no more doubt about the results of this referendum than there is that Ronald Reagan beat Walter Mondale by a similar margin in 1984. I have explained this in a previous post, and in a paper refuting alleged statistical evidence of fraud, and so will not belabor the point here. Also, the Carter Center and the OAS did not simply "condone" an audit by the Venezuelan Electoral Council but were closely involved in the audit as observers and verified the results.
Corrales' attempt to raise doubts about the referendum result is particularly disturbing in light of recent events in Venezuela. Most of the opposition parties boycotted the Venezuelan Congressional elections three weeks ago, on December 4. "We had a problem with the Venezuelan opposition, which assured us that they would not withdraw from the [electoral] process if certain conditions were met. These were met and despite this, they withdrew," said Jose Miguel Insulza, head of the OAS, just this week. The opposition's primary argument for boycotting elections is that they cannot "trust" the electoral process, based on the conspiracy theory, widely held by the opposition in Venezuela, that the recall referendum was stolen. (See http://www.tpmcafe.com/story/2005/12/2/17334/7970 ) Thus, with their own polls showing that they would win about 30 percent of the Congress, they opted for a long-term strategy of destabilization - to try to de-legitimize the government rather than participate in an open and transparent, democratic electoral process that was once again certified as such by international observers, this time including a 160-member team representing the European Union. Such has been the problem for several years: with the brief exception of the August 2004 referendum, wherein the opposition leadership temporarily agreed to play by the rules of democracy - until they lost the vote -- they had previously tried to overthrow the government by means of several oil strikes (one particularly economically devastating in 2002-2003) and a military coup in April 2002, which was supported by the Bush Administration. The Bush Administration also appears to be at least tacitly supportive of the opposition leaders' decision this month to withdraw from electoral politics altogether. In its zeal to create an imaginary "dictatorship" in Venezuela, the Foreign Policy article ignores this anti-democratic role of the opposition, supported by Washington. It is also worth noting that the opposition can pursue such tactics that would have no chance of success in most other democracies because it still controls most of the Venezuelan media.
The editors of Foreign Policy chimed in with a box [p.38] about Chavez accusing him of "meddling in the internal politics of his neighbors" - Bolivia, Brazil, Ecuador, Colombia, Nicaragua, and even Mexico. They neglect to mention that no evidence has yet surfaced for the allegations listed. Also, if Chavez is "meddling" inside Brazil and Colombia, it seems odd that he has such good relations with both of their presidents, who are at opposite ends of the political spectrum. Perhaps they do not appreciate the "threat" that this "dictator" poses to their countries and the region.
There is little evidence that Venezuela today is less democratic than it has ever been, and in fact by most standard political science measures it is more democratic. Venezuela's main governance problem is not a weakening of democracy but a failure to improve the rule of law, a problem that it shares with the region. Contrary to the images conveyed by the Bush Administration and Foreign Policy magazine, the Venezuelan state is not an authoritarian or autocratic state but a weak state, including the executive branch. That is why the main victims of political repression in Venezuela in recent years have not been from the opposition - even the leaders of the April 2002 coup against Chavez, who would have been convicted, imprisoned, and possibly executed in the United States, are almost all still at large. The real victims of political repression are pro-Chavez peasants organizing for land reform in the countryside. Many have been killed, often by hired assassins, sometimes for simply asserting their rights under the law. Impunity is rampant in Venezuela: the state at many levels does not have the capacity to enforce the law, often even against murderers.
In any case there is much more in this article that is inaccurate, grossly exaggerated, or misleading - in fact that describes most of the piece. But rather than wasting more space on this, readers may want to write to the editors of Foreign Policy -- fpletters@CarnegieEndowment.org -- and ask them why they printed something like this. And rather than just printing a 300-word letter, will they ever allow the publication of an article on Venezuela from a different point of view, one that better reflects not only the view of most Venezuelans, but most of this hemisphere? This is unlikely, but it is worth asking them why such an article would be forbidden. It would presumably have to be of much higher quality than the present one and more accurate, not necessarily pro-Chavez, but something that respects democracy, even when poor people repeatedly elect a government that the U.S. State Department doesn't like.
Mark Weisbrot is co-director of the Center for Economic and Policy Research (www.cepr.net) in Washington, DC.
From: TPMCafe Special Guests
Thanks to Josh Eidelson for pointing out some of the flaws in Foreign Policy's latest (January/February 2006) cover story, "Hugo Boss: "How Chavez is refashioning dictatorship for a democratic age." The article is much worse than Eidelson describes it, as will be seen below. The idea that Venezuela is a dictatorship is absurd, as anyone who has been there in the last six years can attest to. All you have to do is go there, turn on the TV and listen to denunciations of the government on the biggest TV stations, pick up the biggest newspapers and see the same - in fact the media plays a non-journalistic oppositional role in politics that would not be allowed in most European democracies. Even in the United States, the long-lapsed Fairness Doctrine would quickly be brought back, if our media ever got to one-tenth the level of partisan political activity exhibited by Venezuela's major broadcast and print media, which make Fox news look impeccably "fair and balanced" by comparison.
Let me correct one error in Eidelson's description, which he may have gotten from the Foreign Policy article, before proceeding: the government of Venezuela has not been "keeping public databases on citizens' votes." All voting is by secret ballot in Venezuela, and there is no record anywhere of any individual's vote. What he might be referring to is the names of people who signed a petition to recall President Chavez in 2004. These petitions are a matter of public record, as similar petitions generally are in the United States; and in fact not only the government, but Sumate, the U.S.-funded opposition group that organized the recall effort, also kept a record of these signers. A legislator subsequently made the names of signers public, causing considerable controversy.
Now for some of the mistakes in the Foreign Policy piece by Javier Corrales:
"Chavez is "now approaching a decade in office." [p.33] Hugo Chavez took office in February of 1999. I have never seen anyone round up to 10 from a number just under 7. Perhaps the subtitle of this article should have been "Refashioning Arithmetic for an Innumerate Age."
"the poor do not support him [Chavez] en masse." [p.35] This can be refuted by any recent poll, as well as by opposition pollsters themselves. Chavez' recent approval ratings have ranged from 65 to 77 percent. Where does this support come from? The upper classes? Perhaps this is another arithmetic problem. Also, a look at the results of the August 2004 referendum, which Chavez won by 59-41 percent, shows one of the most polarized voting patterns in the hemisphere, with poor areas voting overwhelmingly for Chavez and the richer areas voting overwhelmingly against him.
"Chavez has failed to improve any meaningful measure of poverty, education, and equity." [p.35]As I noted in a prior post, the official poverty rate now stands at 38.5 percent, but that counts only cash income. For example, if the United States were to abolish food stamps and Medicaid, poor people here would be much worse off. Similarly, the subsidized food and free health care now available in Venezuela have significantly increased living standards among the poor. More than 40 percent of the country buys subsidized food, and millions of poor people have access to free health care that was previously unavailable. If these are taken into account, the measured poverty rate would drop well below 30 percent.
The poverty rate when Chavez took office, in the first quarter of 1999, was 42.8 percent. So there is a meaningful measure of poverty reduction, especially if non-cash benefits are taken into account. Also, the government declared in October that 1.48 million Venezuelans have been taught to read as a result of a massive literacy drive that began in 2003. Although there is so far no independent verification of the number, even if it turned out to be significantly overestimated, there is no doubt that a very large number of Venezuelans (total population: 25 million) have learned to read under the program.
"Following the 2004 recall referendum, in which Chavez won 58 percent of the vote, the opposition fell into a coma, shocked not so much by the results as by the ease with which international observers condoned the Electoral Council's flimsy audit of the results." [p. 39] Actually, according to all news reports at the time, they were shocked by the results; they announced that the referendum was stolen, and most of the opposition continues to maintain this position. There was nothing "flimsy" about the audit, and there is no more doubt about the results of this referendum than there is that Ronald Reagan beat Walter Mondale by a similar margin in 1984. I have explained this in a previous post, and in a paper refuting alleged statistical evidence of fraud, and so will not belabor the point here. Also, the Carter Center and the OAS did not simply "condone" an audit by the Venezuelan Electoral Council but were closely involved in the audit as observers and verified the results.
Corrales' attempt to raise doubts about the referendum result is particularly disturbing in light of recent events in Venezuela. Most of the opposition parties boycotted the Venezuelan Congressional elections three weeks ago, on December 4. "We had a problem with the Venezuelan opposition, which assured us that they would not withdraw from the [electoral] process if certain conditions were met. These were met and despite this, they withdrew," said Jose Miguel Insulza, head of the OAS, just this week. The opposition's primary argument for boycotting elections is that they cannot "trust" the electoral process, based on the conspiracy theory, widely held by the opposition in Venezuela, that the recall referendum was stolen. (See http://www.tpmcafe.com/story/2005/12/2/17334/7970 ) Thus, with their own polls showing that they would win about 30 percent of the Congress, they opted for a long-term strategy of destabilization - to try to de-legitimize the government rather than participate in an open and transparent, democratic electoral process that was once again certified as such by international observers, this time including a 160-member team representing the European Union. Such has been the problem for several years: with the brief exception of the August 2004 referendum, wherein the opposition leadership temporarily agreed to play by the rules of democracy - until they lost the vote -- they had previously tried to overthrow the government by means of several oil strikes (one particularly economically devastating in 2002-2003) and a military coup in April 2002, which was supported by the Bush Administration. The Bush Administration also appears to be at least tacitly supportive of the opposition leaders' decision this month to withdraw from electoral politics altogether. In its zeal to create an imaginary "dictatorship" in Venezuela, the Foreign Policy article ignores this anti-democratic role of the opposition, supported by Washington. It is also worth noting that the opposition can pursue such tactics that would have no chance of success in most other democracies because it still controls most of the Venezuelan media.
The editors of Foreign Policy chimed in with a box [p.38] about Chavez accusing him of "meddling in the internal politics of his neighbors" - Bolivia, Brazil, Ecuador, Colombia, Nicaragua, and even Mexico. They neglect to mention that no evidence has yet surfaced for the allegations listed. Also, if Chavez is "meddling" inside Brazil and Colombia, it seems odd that he has such good relations with both of their presidents, who are at opposite ends of the political spectrum. Perhaps they do not appreciate the "threat" that this "dictator" poses to their countries and the region.
There is little evidence that Venezuela today is less democratic than it has ever been, and in fact by most standard political science measures it is more democratic. Venezuela's main governance problem is not a weakening of democracy but a failure to improve the rule of law, a problem that it shares with the region. Contrary to the images conveyed by the Bush Administration and Foreign Policy magazine, the Venezuelan state is not an authoritarian or autocratic state but a weak state, including the executive branch. That is why the main victims of political repression in Venezuela in recent years have not been from the opposition - even the leaders of the April 2002 coup against Chavez, who would have been convicted, imprisoned, and possibly executed in the United States, are almost all still at large. The real victims of political repression are pro-Chavez peasants organizing for land reform in the countryside. Many have been killed, often by hired assassins, sometimes for simply asserting their rights under the law. Impunity is rampant in Venezuela: the state at many levels does not have the capacity to enforce the law, often even against murderers.
In any case there is much more in this article that is inaccurate, grossly exaggerated, or misleading - in fact that describes most of the piece. But rather than wasting more space on this, readers may want to write to the editors of Foreign Policy -- fpletters@CarnegieEndowment.org -- and ask them why they printed something like this. And rather than just printing a 300-word letter, will they ever allow the publication of an article on Venezuela from a different point of view, one that better reflects not only the view of most Venezuelans, but most of this hemisphere? This is unlikely, but it is worth asking them why such an article would be forbidden. It would presumably have to be of much higher quality than the present one and more accurate, not necessarily pro-Chavez, but something that respects democracy, even when poor people repeatedly elect a government that the U.S. State Department doesn't like.
Mark Weisbrot is co-director of the Center for Economic and Policy Research (www.cepr.net) in Washington, DC.
Social Reforms Making Slow Progress in South America
By Marcela Valente
BUENOS AIRES, Dec 28 (IPS) - Hit hard by the impact of free-market "neoliberal" policies during the 1990s, in recent years many South American voters have opted for progressive governments. But the social agenda of the new administrations has lagged, and while some countries are moving forward slowly, the progress made by others is frankly disappointing.
IPS interviewed a sociologist, an economist and a political scientist about the challenge taken on by leftwing, centre-left or "progressive" parties, alliances and movements now in government, who when they were in opposition criticised structural adjustment policies, the dismantling of the State and the opening up of markets in Argentina, Brazil, Chile, Uruguay, Venezuela, and, now, Bolivia.
The new governments are committed, on the one hand, to maintaining a balanced budget, meeting debt-servicing payments punctually, and attracting investment by offering solid guarantees. Voters, on the other hand, expect them to fulfil their electoral promises to fight poverty and unemployment, and distribute wealth more equitably in the region with the greatest gap between rich and poor in the world.
Sociologist Atilio Borón, executive secretary of the Latin American Council of Social Sciences, believes the challenge is a realistic one. "But it implies a paradigm shift in economic policy which so far the countries have not sought. The most disappointing experience of all is that of Brazil," he stated.
Great hopes arose in Brazil in January 2003 when Luiz Inácio Lula da Silva, a former trade union leader and metal worker, came to power. However, his leftist Workers' Party has not achieved as much in terms of economic growth and job creation as was expected.
Lula does have some achievements to his credit.
Extreme poverty fell from 27.26 to 25.08 percent of the population in 2004, the Getulio Vargas Foundation in Rio de Janeiro reported in early December. This means that more than three million people have escaped extreme poverty, eight percent of the 40 million people who were extremely poor in 2003.
The minimum salary was increased by nine percent this year, and the programme of "family grants" (a subsidy for poor families) benefited 6.57 million households in 2004. The goal is to reach 8.7 million families in 2005, and 11.2 million by the end of Lula's term, in December 2006.
However, Lula's economic policies have so far been based on excessively tight spending to ensure debt payments, and on high interest rates to fight inflation, a combination that is far from novel and creates recession.
In Argentina, governed by the left-leaning Néstor Kirchner since May 2003, one can see "a certain willingness to change things, at least in some areas," Borón commented. After the late 2001 economic and financial collapse, the poverty rate climbed to well over 50 percent, whereas in the last two years it has fallen to 40 percent.
But essentially the government "is adhering strictly to the prescriptions of the Washington Consensus, with no change in direction of its economic policy," he added.
"Washington Consensus" refers to a set of structural adjustment policies prescribed by the World Bank, the Interamerican Development Bank and the International Monetary Fund beginning in the 1980s. The reforms included the privatisation of state enterprises, fiscal policy discipline, deregulation, openness to foreign direct investment, and trade liberalisation.
In Borón's view, in-depth change in Argentina would require implementing tax reforms to make the current tax system less regressive. "Selling a 1985 model car is a taxable transaction, but selling a 15 billion dollar company isn't," he illustrated.
This system, which does not tax income on financial assets, was inherited from the administration of Carlos Menem (1989-1999). During that period, one of the region's most orthodox versions of the neoliberal model was put into practice. And "The present government is using the same tax system," the sociologist pointed out.
Borón considers the legacy of the Chilean government led by socialist President Ricardo Lagos to be "another frustration." Lagos is about to end his term of office with a high popularity rating. However, during his administration "there was economic progress," but inequality was not reduced, he stated.
The centre-left coalition that has governed Chile since 1990 has not managed to reverse the social inequality left behind by the military regime.
"Chile used to be one of the most egalitarian countries in Latin America - before the dictatorship of Augusto Pinochet (1973-1990) - and now it has become one of the most unequal in the region," noted Borón.
However, Chile has reduced poverty by half, from 38.5 percent of the population in 1990 to 18.8 percent this year, while extreme poverty has fallen from 12.9 to 4.7 percent over the same period. Chile is the first Latin American country to fulfil the first of the eight Millennium Development Goals adopted by the United Nations General Assembly in 2000.
Lagos's likely successor is socialist candidate Michelle Bachelet, who will face off with her rightwing rival Sebastián Piñera in a runoff election in January.
Argentine political scientist Rosendo Fraga, director of the New Majority Studies Centre, pointed out that "Chile has reduced poverty, but it hasn't made significant progress in reducing inequality."
"In Brazil, the social statistics for 2004 show some progress," but in Argentina and Venezuela, in spite of the economic growth they have enjoyed this year, "poverty levels remain stable," Fraga observed.
"Poverty reduction is possible with sustained growth. But reducing inequality seems to be more difficult," he added.
Joint action by this group of countries might be an effective way of fighting inequality, but Brazil and Argentina, who are the economic powerhouses of the sub-region, should take the lead, said Borón. "We can't expect Bolivia or Uruguay to be the front-runners," he stated.
The first leftwing government in the history of Uruguay took office in March, led by socialist President Tabaré Vázquez. It has instituted a wide-ranging social programme to fight poverty and extreme poverty, under the new Ministry of Social Development.
In Bolivia, meanwhile, the leader of the country's coca farmers, Evo Morales, won a majority of votes in the Dec. 18 presidential election, an unprecedented triumph for an indigenous leader. "Perhaps Morales will be more consistent and make better progress on social issues, supported by a strong grassroots movement," Borón said.
Referring to Venezuela, Borón said the government of Hugo Chávez "is trying out a new economic, social and political regime" that involves a departure from "the Washington Consensus. He is blazing an important trail, but not one that should be imitated. Changes should arise from processes originating within each country," he stated.
According to José Luis Coraggio, an economist and expert in social policy, "there is no reason" why a government that is prudent in its public accounts should not be able to adopt measures to reduce poverty and distribute wealth more fairly. "The only problem is political will," he declared.
"There is plenty of capacity for contributing revenue in our countries. The problem is that there is a high level of tax evasion, and changing that takes a great deal of political will," indicated Coraggio, who is a member of the Phoenix Plan, a group of academics at the University of Buenos Aires who came together in 2001 to help design a new model of development.
"A few signs of a new model are visible, but we have a long way to go yet," said the expert, referring to the group of countries in the region that are facing the same challenge. Coraggio believes that Argentina and Brazil "are making a little progress with a lot of effort" in social policy.
"Chile is presented as the new development paradigm, but they have got used to living with a model marked by a high level of inequality," the economist criticised.
An expert in grassroots economy and local development, Coraggio believes that an economic model based on social justice should be sought, with better access to credit, land and technology, and with the State playing the role of "guarantor" of development.
In Borón's view, the argument that presupposes that the United States will resist the development of South America "is small-minded," but he recognised that "any government trying to put through a programme of changes is going to face tenacious resistance and formidable adversaries."
Neither does he believe that foreign investments will be curtailed if progressive governments move forward on social issues. On the contrary, "investment will come when the internal market expands to include the entire population" through greater buying power, he indicated.
Most South American countries no longer follow the same economic policies as in the 1990s, but "they are very slowly advancing towards a new paradigm." "A very definite political will is needed to go further, and so far this has not been seen," Borón remarked. (END/2005)
BUENOS AIRES, Dec 28 (IPS) - Hit hard by the impact of free-market "neoliberal" policies during the 1990s, in recent years many South American voters have opted for progressive governments. But the social agenda of the new administrations has lagged, and while some countries are moving forward slowly, the progress made by others is frankly disappointing.
IPS interviewed a sociologist, an economist and a political scientist about the challenge taken on by leftwing, centre-left or "progressive" parties, alliances and movements now in government, who when they were in opposition criticised structural adjustment policies, the dismantling of the State and the opening up of markets in Argentina, Brazil, Chile, Uruguay, Venezuela, and, now, Bolivia.
The new governments are committed, on the one hand, to maintaining a balanced budget, meeting debt-servicing payments punctually, and attracting investment by offering solid guarantees. Voters, on the other hand, expect them to fulfil their electoral promises to fight poverty and unemployment, and distribute wealth more equitably in the region with the greatest gap between rich and poor in the world.
Sociologist Atilio Borón, executive secretary of the Latin American Council of Social Sciences, believes the challenge is a realistic one. "But it implies a paradigm shift in economic policy which so far the countries have not sought. The most disappointing experience of all is that of Brazil," he stated.
Great hopes arose in Brazil in January 2003 when Luiz Inácio Lula da Silva, a former trade union leader and metal worker, came to power. However, his leftist Workers' Party has not achieved as much in terms of economic growth and job creation as was expected.
Lula does have some achievements to his credit.
Extreme poverty fell from 27.26 to 25.08 percent of the population in 2004, the Getulio Vargas Foundation in Rio de Janeiro reported in early December. This means that more than three million people have escaped extreme poverty, eight percent of the 40 million people who were extremely poor in 2003.
The minimum salary was increased by nine percent this year, and the programme of "family grants" (a subsidy for poor families) benefited 6.57 million households in 2004. The goal is to reach 8.7 million families in 2005, and 11.2 million by the end of Lula's term, in December 2006.
However, Lula's economic policies have so far been based on excessively tight spending to ensure debt payments, and on high interest rates to fight inflation, a combination that is far from novel and creates recession.
In Argentina, governed by the left-leaning Néstor Kirchner since May 2003, one can see "a certain willingness to change things, at least in some areas," Borón commented. After the late 2001 economic and financial collapse, the poverty rate climbed to well over 50 percent, whereas in the last two years it has fallen to 40 percent.
But essentially the government "is adhering strictly to the prescriptions of the Washington Consensus, with no change in direction of its economic policy," he added.
"Washington Consensus" refers to a set of structural adjustment policies prescribed by the World Bank, the Interamerican Development Bank and the International Monetary Fund beginning in the 1980s. The reforms included the privatisation of state enterprises, fiscal policy discipline, deregulation, openness to foreign direct investment, and trade liberalisation.
In Borón's view, in-depth change in Argentina would require implementing tax reforms to make the current tax system less regressive. "Selling a 1985 model car is a taxable transaction, but selling a 15 billion dollar company isn't," he illustrated.
This system, which does not tax income on financial assets, was inherited from the administration of Carlos Menem (1989-1999). During that period, one of the region's most orthodox versions of the neoliberal model was put into practice. And "The present government is using the same tax system," the sociologist pointed out.
Borón considers the legacy of the Chilean government led by socialist President Ricardo Lagos to be "another frustration." Lagos is about to end his term of office with a high popularity rating. However, during his administration "there was economic progress," but inequality was not reduced, he stated.
The centre-left coalition that has governed Chile since 1990 has not managed to reverse the social inequality left behind by the military regime.
"Chile used to be one of the most egalitarian countries in Latin America - before the dictatorship of Augusto Pinochet (1973-1990) - and now it has become one of the most unequal in the region," noted Borón.
However, Chile has reduced poverty by half, from 38.5 percent of the population in 1990 to 18.8 percent this year, while extreme poverty has fallen from 12.9 to 4.7 percent over the same period. Chile is the first Latin American country to fulfil the first of the eight Millennium Development Goals adopted by the United Nations General Assembly in 2000.
Lagos's likely successor is socialist candidate Michelle Bachelet, who will face off with her rightwing rival Sebastián Piñera in a runoff election in January.
Argentine political scientist Rosendo Fraga, director of the New Majority Studies Centre, pointed out that "Chile has reduced poverty, but it hasn't made significant progress in reducing inequality."
"In Brazil, the social statistics for 2004 show some progress," but in Argentina and Venezuela, in spite of the economic growth they have enjoyed this year, "poverty levels remain stable," Fraga observed.
"Poverty reduction is possible with sustained growth. But reducing inequality seems to be more difficult," he added.
Joint action by this group of countries might be an effective way of fighting inequality, but Brazil and Argentina, who are the economic powerhouses of the sub-region, should take the lead, said Borón. "We can't expect Bolivia or Uruguay to be the front-runners," he stated.
The first leftwing government in the history of Uruguay took office in March, led by socialist President Tabaré Vázquez. It has instituted a wide-ranging social programme to fight poverty and extreme poverty, under the new Ministry of Social Development.
In Bolivia, meanwhile, the leader of the country's coca farmers, Evo Morales, won a majority of votes in the Dec. 18 presidential election, an unprecedented triumph for an indigenous leader. "Perhaps Morales will be more consistent and make better progress on social issues, supported by a strong grassroots movement," Borón said.
Referring to Venezuela, Borón said the government of Hugo Chávez "is trying out a new economic, social and political regime" that involves a departure from "the Washington Consensus. He is blazing an important trail, but not one that should be imitated. Changes should arise from processes originating within each country," he stated.
According to José Luis Coraggio, an economist and expert in social policy, "there is no reason" why a government that is prudent in its public accounts should not be able to adopt measures to reduce poverty and distribute wealth more fairly. "The only problem is political will," he declared.
"There is plenty of capacity for contributing revenue in our countries. The problem is that there is a high level of tax evasion, and changing that takes a great deal of political will," indicated Coraggio, who is a member of the Phoenix Plan, a group of academics at the University of Buenos Aires who came together in 2001 to help design a new model of development.
"A few signs of a new model are visible, but we have a long way to go yet," said the expert, referring to the group of countries in the region that are facing the same challenge. Coraggio believes that Argentina and Brazil "are making a little progress with a lot of effort" in social policy.
"Chile is presented as the new development paradigm, but they have got used to living with a model marked by a high level of inequality," the economist criticised.
An expert in grassroots economy and local development, Coraggio believes that an economic model based on social justice should be sought, with better access to credit, land and technology, and with the State playing the role of "guarantor" of development.
In Borón's view, the argument that presupposes that the United States will resist the development of South America "is small-minded," but he recognised that "any government trying to put through a programme of changes is going to face tenacious resistance and formidable adversaries."
Neither does he believe that foreign investments will be curtailed if progressive governments move forward on social issues. On the contrary, "investment will come when the internal market expands to include the entire population" through greater buying power, he indicated.
Most South American countries no longer follow the same economic policies as in the 1990s, but "they are very slowly advancing towards a new paradigm." "A very definite political will is needed to go further, and so far this has not been seen," Borón remarked. (END/2005)
Tuesday, December 27, 2005
Peru nationalist tops presidential poll, stocks fall
Tue Dec 27, 2005 12:25 PM ET
LIMA, Peru, Dec 27 (Reuters) - Retired army commander Ollanta Humala, whose plans to rewrite contracts with foreign companies worry investors, has jumped to a tie for front-runner status in Peru's presidential election next April, a poll showed on Tuesday.
Humala, who led an attempted coup in 2000 against then- President Alberto Fujimori, has 21.7 percent of popular support, up from 9.1 percent in October, pollster IDICE said.
The nationwide IDICE poll, conducted Dec. 19-23, showed Humala statistically tied for first place with center-right opposition politician Lourdes Flores who has 21.2 percent of support, followed by former President Alan Garcia with 19.8 percent.
Garcia, once a populist firebrand widely criticized for presiding over hyperinflation and growing Shining Path rebel violence in the 1980s, has won some support in recent years by presenting himself as a moderate center-left leader.
The poll of 4,950 homes, which had a margin of error of plus or minus 4.5 percent, showed Humala had gained ground at the expense of Flores and Garcia in recent months.
Former interim President Valentin Paniagua, a centrist politician, was fourth with 16.7 percent.
Humala's rise has frightened investors and the Lima General Stock Index fell 2.71 percent to 4,735.97 points because of the poll, two traders at Lima-based brokerages told Reuters. Peru's stock market notched up its biggest one-day loss since 2000 on Dec. 19, over fears that Humala could take power on July 28, 2006.
Humala says that as president he would rewrite the constitution to create a "Second Republic" rejecting Peru's pro-market policies implemented by Fujimori and continued by current President Alejandro Toledo.
Humala also wants to rewrite contracts with foreign companies who extract Peru's mineral and natural gas wealth to "defend Peru's national identity."
According to political analysts, Humala has won support with Peru's rural poor because many Peruvians are disillusioned with traditional politicians after years of economic boom and bust and failed promises of jobs and prosperity.
Some traders say that the victory of Indian leader Evo Morales in Bolivia's elections this month has fanned fears about Humala because investors worry it may help Humala's campaign. Both men are seen as against free trade.
Humala has visited Bolivia in recent months but denies any links to Morales.
LIMA, Peru, Dec 27 (Reuters) - Retired army commander Ollanta Humala, whose plans to rewrite contracts with foreign companies worry investors, has jumped to a tie for front-runner status in Peru's presidential election next April, a poll showed on Tuesday.
Humala, who led an attempted coup in 2000 against then- President Alberto Fujimori, has 21.7 percent of popular support, up from 9.1 percent in October, pollster IDICE said.
The nationwide IDICE poll, conducted Dec. 19-23, showed Humala statistically tied for first place with center-right opposition politician Lourdes Flores who has 21.2 percent of support, followed by former President Alan Garcia with 19.8 percent.
Garcia, once a populist firebrand widely criticized for presiding over hyperinflation and growing Shining Path rebel violence in the 1980s, has won some support in recent years by presenting himself as a moderate center-left leader.
The poll of 4,950 homes, which had a margin of error of plus or minus 4.5 percent, showed Humala had gained ground at the expense of Flores and Garcia in recent months.
Former interim President Valentin Paniagua, a centrist politician, was fourth with 16.7 percent.
Humala's rise has frightened investors and the Lima General Stock Index fell 2.71 percent to 4,735.97 points because of the poll, two traders at Lima-based brokerages told Reuters. Peru's stock market notched up its biggest one-day loss since 2000 on Dec. 19, over fears that Humala could take power on July 28, 2006.
Humala says that as president he would rewrite the constitution to create a "Second Republic" rejecting Peru's pro-market policies implemented by Fujimori and continued by current President Alejandro Toledo.
Humala also wants to rewrite contracts with foreign companies who extract Peru's mineral and natural gas wealth to "defend Peru's national identity."
According to political analysts, Humala has won support with Peru's rural poor because many Peruvians are disillusioned with traditional politicians after years of economic boom and bust and failed promises of jobs and prosperity.
Some traders say that the victory of Indian leader Evo Morales in Bolivia's elections this month has fanned fears about Humala because investors worry it may help Humala's campaign. Both men are seen as against free trade.
Humala has visited Bolivia in recent months but denies any links to Morales.
The Chávez Theorem
How Venezuela Pulverised the Rhetoric of the Neo-Liberal Left
By MANUEL TALENS
Counterpunch
December 2, 2005
I looked for the word "theorem" in two of my favourite dictionaries, the DRAE of the Real Academia Española, establishes that it is a "demonstrable proposition that logically comes from axioms or other already demonstrated theorems, through accepted rules of inference." It's a bit nebulous of an explanation that is in contrast with that of the María Moliner dictionary, an example of transparent Castilian: "affirmation susceptible to scientific demonstration." For the purposes of this article, I want to use both of the definitions, beginning with that of the DRAE, which insists upon the deductive aspects of reasoning.
The media that we are surrounded by habitually empty some indispensable words of their content, and that is for the purpose of inducing the unreflecting citizen to continue to accept them as if they still had the original meaning. I have here two examples which all of us meet up with in the newspapers: "democracy" and "left". In the Spain of my adolescence, those who abhorred the policies of Franco dreamed of those two words. Time passed, the dictator died, the transition took place, democracy was established and with it, even the left came to power. But have those dreams come true?
In conformity with the DRAE, if we start from the double linguistic axiom according to which the Greek root demos means people and crazia stands for government, a hypothetical Democracy Theorem should be defined as follows: "Democracy is a political system in which the people are the government". That which escapes the wisdom of the academics is that many post-modern think tanks today deliberately alter language and so, just like the dead civilians of some imperialist war are now collateral damage, the word Freedom on Bush's lips means Slavery in Iraq, or the respect for minorities isn't the same thing for a white leader of either the Mexican PRI (Institutional Revolutionary Party) or PAN (National Action Party) and for a Zapatist Indio, so then, with "democracy" the same thing happened: every similarity between the elite who control our bourgeois democracies and the people that they presumably represent is pure coincidence; that changes the definition of the DRAE of theorem into something useless for its scarse deductive applicability on the terrain of contemporary political praxis.
Let's examine the word "left" as well. After the French Revolution, the masses of the capital collocated themselves on the left side of the Legislative Assembly, while those who offered unconditional support to the Constitution of 1792 went to the right. This was the origin of the political adoption of the term "left", thus received in inheritance for the parties of Marxist orientation that had succeeded it up to the 21st century. Let us see how the Left Theorem sounds, still following the indications of the DRAE: "Left is that which tends to substitute capitalism with socialism." Is this still the truth in our democracies? The Spanish Socialist Workers Party (PSOE) renounced Marxism during the rule of Felipe González and now it is Social Democrat, which means that it submits to capitalism and aspires to give it a human face. It is not socialist any more, and yet, it continues to define itself as left, much in consonance with its fellow parishioners, that seem to lose their plumes as they move along: the French, Portuguese and Chilean Socialist parties are becoming Neo-Liberal so as to increase their votes, the Labour Party in Great Britain is losing in the land of Iraq what little honour that remained; the Mexican PRD (Democratic Revolution Party), as Gilberto López y Rivas says well, abandons its founding principles and the International Socialist survives, with more sorrows than glory, after having accepted an economic system that its forefathers refused with vehemence.
The arguments exposed justify my reservations on the definition of theorem offered by the DRAE. I prefer the sobriety of María Moliner, because it mentions science ("affirmation susceptible to scientific demonstration") introduces a measurable difference, near to the mathematical exactness of the theorems of Pythagoras or Euclid.
Let us look at how this definition applies to the political trajectory of the Venezuelan President Hugo Chávez, a man that is adored by his people, but who is victim to the ire of the most rancid right of Venezuela and the West, and the verbal disgust of many "leftists" who today crowd the media and the parliaments of America and Europe. If we apply to Chávez the axioms so unassailable such as the overwhelming results of all of the elections that he has won cleanly or the numbers in millions of the poor Venezuelans who, for the first time in the history of their country are provided with medical care, access to culture and the hope of prosperity since he arrived in power, it is simple to conclude that in Venezuela the above cited theorems of Democracy and of Left (as much in the deductive point of view of the DRAE as the scientific one of María Moliner), that permits me to formulate, "through rules of inference", the definition of a Creole theorem that, to my mind, has the double virtue of unmasking the imposters of the left as it renders justice to a generous man who is providential for the future of Latin America. I have called it the Chávez Theorem and it goes thus: "A leftist is anybody who defends Chávez."
Manuel Talens is a Spanish novelist, short story writer and columnist. His columns appear mainly in the Madrid newspaper El País and the electronic alternative site Rebelión , where he is also a frequent translator of both Francophone and Anglophone leftwing writers and activists. He has also translated works by authors like Georges Simenon, Edith Wharton, Groucho Marx, Paul Virilio, Derek Walcott, Geert Lovink, James Petras and Donna J. Haraway, among many others. His website is www.manueltalens.com.
By MANUEL TALENS
Counterpunch
December 2, 2005
I looked for the word "theorem" in two of my favourite dictionaries, the DRAE of the Real Academia Española, establishes that it is a "demonstrable proposition that logically comes from axioms or other already demonstrated theorems, through accepted rules of inference." It's a bit nebulous of an explanation that is in contrast with that of the María Moliner dictionary, an example of transparent Castilian: "affirmation susceptible to scientific demonstration." For the purposes of this article, I want to use both of the definitions, beginning with that of the DRAE, which insists upon the deductive aspects of reasoning.
The media that we are surrounded by habitually empty some indispensable words of their content, and that is for the purpose of inducing the unreflecting citizen to continue to accept them as if they still had the original meaning. I have here two examples which all of us meet up with in the newspapers: "democracy" and "left". In the Spain of my adolescence, those who abhorred the policies of Franco dreamed of those two words. Time passed, the dictator died, the transition took place, democracy was established and with it, even the left came to power. But have those dreams come true?
In conformity with the DRAE, if we start from the double linguistic axiom according to which the Greek root demos means people and crazia stands for government, a hypothetical Democracy Theorem should be defined as follows: "Democracy is a political system in which the people are the government". That which escapes the wisdom of the academics is that many post-modern think tanks today deliberately alter language and so, just like the dead civilians of some imperialist war are now collateral damage, the word Freedom on Bush's lips means Slavery in Iraq, or the respect for minorities isn't the same thing for a white leader of either the Mexican PRI (Institutional Revolutionary Party) or PAN (National Action Party) and for a Zapatist Indio, so then, with "democracy" the same thing happened: every similarity between the elite who control our bourgeois democracies and the people that they presumably represent is pure coincidence; that changes the definition of the DRAE of theorem into something useless for its scarse deductive applicability on the terrain of contemporary political praxis.
Let's examine the word "left" as well. After the French Revolution, the masses of the capital collocated themselves on the left side of the Legislative Assembly, while those who offered unconditional support to the Constitution of 1792 went to the right. This was the origin of the political adoption of the term "left", thus received in inheritance for the parties of Marxist orientation that had succeeded it up to the 21st century. Let us see how the Left Theorem sounds, still following the indications of the DRAE: "Left is that which tends to substitute capitalism with socialism." Is this still the truth in our democracies? The Spanish Socialist Workers Party (PSOE) renounced Marxism during the rule of Felipe González and now it is Social Democrat, which means that it submits to capitalism and aspires to give it a human face. It is not socialist any more, and yet, it continues to define itself as left, much in consonance with its fellow parishioners, that seem to lose their plumes as they move along: the French, Portuguese and Chilean Socialist parties are becoming Neo-Liberal so as to increase their votes, the Labour Party in Great Britain is losing in the land of Iraq what little honour that remained; the Mexican PRD (Democratic Revolution Party), as Gilberto López y Rivas says well, abandons its founding principles and the International Socialist survives, with more sorrows than glory, after having accepted an economic system that its forefathers refused with vehemence.
The arguments exposed justify my reservations on the definition of theorem offered by the DRAE. I prefer the sobriety of María Moliner, because it mentions science ("affirmation susceptible to scientific demonstration") introduces a measurable difference, near to the mathematical exactness of the theorems of Pythagoras or Euclid.
Let us look at how this definition applies to the political trajectory of the Venezuelan President Hugo Chávez, a man that is adored by his people, but who is victim to the ire of the most rancid right of Venezuela and the West, and the verbal disgust of many "leftists" who today crowd the media and the parliaments of America and Europe. If we apply to Chávez the axioms so unassailable such as the overwhelming results of all of the elections that he has won cleanly or the numbers in millions of the poor Venezuelans who, for the first time in the history of their country are provided with medical care, access to culture and the hope of prosperity since he arrived in power, it is simple to conclude that in Venezuela the above cited theorems of Democracy and of Left (as much in the deductive point of view of the DRAE as the scientific one of María Moliner), that permits me to formulate, "through rules of inference", the definition of a Creole theorem that, to my mind, has the double virtue of unmasking the imposters of the left as it renders justice to a generous man who is providential for the future of Latin America. I have called it the Chávez Theorem and it goes thus: "A leftist is anybody who defends Chávez."
Manuel Talens is a Spanish novelist, short story writer and columnist. His columns appear mainly in the Madrid newspaper El País and the electronic alternative site Rebelión , where he is also a frequent translator of both Francophone and Anglophone leftwing writers and activists. He has also translated works by authors like Georges Simenon, Edith Wharton, Groucho Marx, Paul Virilio, Derek Walcott, Geert Lovink, James Petras and Donna J. Haraway, among many others. His website is www.manueltalens.com.
The New Cooperative Movement in Venezuela's Bolivarian Process
by Camila Piñeiro Harnecker
Monthly Review
December 5, 2005
I arrived in Caracas in July 2005 with a few contacts at different cooperatives, anxious about how I would sort through the more than 70,000 cooperatives that the Superintendencia Nacional de Cooperativas (National Superintendence of Cooperatives -- SUNACOOP) had referred to in its recent press statements. Indeed, I found cooperatives everywhere. Between one night and the next morning, I stumbled on cooperatives in some rather unexpected places: a group of artisans in the neighborhood near my hotel, a group of tour guides who entertained children in a nearby park, the cleaning crew of an office building where I went to conduct an interview. Even the taxi drivers in front of the hotel where I was staying had left their private employer to form a cooperative.
Spaces for small enterprises, especially cooperatives, have been opened by a great number of local governments, public institutions, and enterprises, including Venezuela's oil company, PDVSA. These agencies have established contract-bidding procedures that, while demanding competitive quality and costs, don't discriminate against small enterprises and cooperatives. They have also encouraged workers employed by private contractors to form cooperatives. For example, CADELA, one of the five regional branches of the state-owned national electric company, encouraged its maintenance and security subcontract workers to leave their private employers and form their own cooperatives. CADELA is an enterprise under co-management and has been very supportive of cooperatives.1 Similarly, most of the stations of Caracas's state-owned rapid transportation system are maintained by cooperatives created by employees of former private businesses. The Public Works Division of Caracas's main municipality has promoted Local Works Cabinets (Gabinetes de Obras Locales) through which neighbors organize themselves in working tables to decide which public works on infrastructure should be done and supervise them. The community also decides which cooperatives in the neighborhood carry out the work.2
When President Hugo Chavez assumed power in 1998, there were only 762 cooperatives in Venezuela.3 These cooperatives, as the rest of Venezuelan society, had survived the structural adjustment measures started by the presidency of Carlos Andres Perez in 1989. In the two decades before the rise of Chavez, Venezuelan GDP fell almost continuously, and inequality became extreme. An estimated 80 percent of the population lived in poverty and more than half of the employment was in the informal sector.4 The Venezuelan economy is also heavily dependent on oil revenue, with most of its GDP coming from oil exports.5 Much of the food is imported, well under FAO's minimum food production levels for food self-sufficiency.6
To deal with this social and economic situation, the Chavez administration has embraced a new development model, referred to as "endogenous development." Its conceptualization draws heavily from Osvaldo Sunkel's ideas in Development from Within: Toward a Neostructuralist Approach for Latin America (1993) which calls for an adaptation of import substitution policies which prioritize equity, human development, and development adjusted to specific local conditions and employing local resources. The official interpretation of endogenous development also emphasizes the importance of local, diversified, and sustainable development, and the commitment to respect Venezuelans' different cultures and identities.7 Most significantly, committed to including the historically-marginalized sectors of the Venezuelan society, the Chavez government also recognizes the need to democratize the economy, combat inequalities, and encourage solidarity in order to pay the accumulated "social debt" to the popular sectors.
The cooperative production model has increasingly come to define the development strategies of the "Bolivarian Revolution." In its August 2005 report, SUNACOOP registered a total of 83,769 cooperatives, with more than 40,000 cooperatives created in 2004 and almost 30,000 more cooperatives formed in the first eight months of 2005. The total number of associates in October 2004 was 945,517, up from 215,000 in 1998.
This proliferation originates in the recognition of cooperatives throughout the 1999 Bolivarian Constitution as key economic actors within the nation's social economy, portrayed as tools for economic inclusion, participation (article 70), and state decentralization (article 184). More significantly, the state is expected to "promote and protect" cooperatives (articles 118 and 308). It wasn't until the Ley Especial de Asociaciones Cooperativas (Special Law of Cooperative Associations) was published in September 2001 that numbers started growing with almost 1,000 cooperatives in 2001, more than 2,000 in 2002, and more than 8,000 in 2003.8
In March 2004, the Misión Vuelvan Caras was created to "change the nation's economic, social, political and cultural model in order to attain a State of Justice and Law sustained by an endogenous socio-economic development, as asserted in the Bolivarian Constitution."9 Most students were recent graduates from other educational missions that allowed Venezuelans to finish primary and secondary education. The missions are social programs to promote education, health, and culture, funded by the surplus from oil revenues and managed directly by the executive. They were created by the Chavez administration as parallel structures to avoid the bureaucracy inherited by the existing ministries.
Through Vuelvan Caras, between December 2004 and May 2005, 264,720 students graduated from semester- to year-long classes on technical, managerial, and historical subjects, as well as on citizenship and cooperative values. During this period, students received scholarships and opportunities to improve their quality of life, especially health and housing conditions. Although graduates from Vuelvan Caras are free to seek individual employment or form micro-enterprises by themselves, it was made clear that cooperatives were a preferable form of organization which would be prioritized for state support. Students in the mission were encouraged to form cooperatives, and 195,095 graduates, or nearly 70 percent, did, resulting in 7,592 new cooperatives.10
In September 2004, the Venezuelan government created a Ministerio de Economía Popular (Ministry of Popular Economy -- MINEP) to support and institutionalize the Vuelvan Caras program, and to coordinate the work of the existing and newly-created lending institutions. Its role is to coordinate and draft policies to promote micro-enterprises, cooperatives, and other self-sustaining productive units that contribute to collective wellbeing and dignify productive labor.11 MINEP's publications maintain that Vuelvan Caras is not an employment program and that cooperatives are not promoted in order to fulfill its commitment to provide employment for all Vuelvan Caras graduates -- rather, cooperatives are seen as a central component of "an economic model whose raison d’être is collective wellbeing rather than capital accumulation."12
After the Chavez government won a recall referendum that left his opponents reeling, Chavez defined the "new strategic map" for a subsequent stage of the "Bolivarian Revolution" in a meeting with government officials in November 2004. Among the 10 strategic objectives that Chavez mentioned was the commitment to "advance in the conformation of a new social structure," to establish "a new democratic model of popular participation," and to "speed up the construction of a new productive model towards the formation of a new economic system."13
The creation and support of cooperatives integrated in Núcleos de Desarrollo Endógeno (Endogenous Development Zones - NUDEs) by MINEP is a key strategy towards that aim. A NUDE is formed by one or more Vuelvan Caras' cooperatives that join to design a project, with the assistance of MINEP's specialists, for a physical space (land, factories, installations) they have identified and can be made available by MINEP. When the project proposal is finished and accepted, the cooperatives receive on-site technical support, the necessary credit (generally at zero interest and with some grace period), and the physical space (generally provided in usufruct). In May 2005, there were 115 active development zones with a total of 27,975 Vuelvan Caras graduates (near 10 percent of all graduates) in 960 cooperatives (near 12 percent of all cooperatives created within the mission) -- 73.5 percent in agriculture with 20,411 graduates in 699 cooperatives; 14.8 percent in industry with 4,377 graduates in 155 cooperatives; and 10.4 percent in tourism with 3,063 graduates in 103 cooperatives.14
Visiting one NUDE specializing in manufacturing, one specializing in agriculture, and another specializing in tourism, I could observe a great deal of the efforts required and difficulties involved in establishing a NUDE. MINEP's specialists provided constant on-site technical assistance and pushed bureaucracy so that the infrastructure and inputs that cooperatives were supposed to obtain from public institutions, as it was stated in their contracts, were actually delivered. Most cooperative members referred to internal communication problems as the greatest challenge but seemed to be hopeful that time and practice under equal rights would solve them. Most cooperative members have little administrative and management skills, and only few have started taking the classes on management and administration provided by MINEP. However, most cooperatives I talked to seemed to be very aware of the importance of productivity. Their commitment to productivity is not only moral ("Vuelvan Caras has to be a success") but also rational in the economic sense. In order to receive new credits and maintain the resources given in usufruct, cooperatives have to pay off their loans and comply with their contracts.
The majority of the cooperatives are in the production of goods and services and in agriculture.15 MINEP's focus on agricultural and manufacturing cooperatives is indicative of the priority given to production of goods necessary to meet basic needs. It is also consistent with the Chavez administration's aim of achieving food security and reducing dependency on imports of other products to satisfy basic needs.
Since March 2005, MINEP has been in the process of installing regional technical committees to decentralize its functions and services. Each regional technical committee encapsulates all state institutions subordinate to MINEP, including SUNACOOP, the National Institute for Cooperative Education (INCE, which provides most of the logistics and specialists), and the six specialized funding institutions, several of them created by the Chavez government. The aim is to create a decentralized "synergy" of public institutions characterized by public accessibility and administrative transparency, allowing more citizen oversight. Additionally, this organizational approach is designed to prevent bureaucratization, inefficiency, corruption, and other evils. Towards its goal of placing all graduates, MINEP soon plans to activate another 140 development zones.16 It also aims to provide funding for all Vuelvan Caras cooperatives, 60 percent of which (4,036) have already received more than $265 million, while an additional 30 percent were expected to receive it in September 2005.17
In September 2005, MINEP held the first of a series of regional meetings with the goal of "debating and solving strategic aspects of the Vuelvan Caras mission's performance in each state of the country."18 Once all cooperatives and development zones are active (having received installations, technical assistance, and credit if necessary), MINEP plans to start a new cycle of the Vuelvan Caras mission. Vuelvan Caras II is expected to start in January 2006 with more than 700,000 students and hopes to organize them in another 2,000 cooperatives.19
In addition to providing technical assistance, infrastructure, and credits for cooperatives and micro-enterprises, MINEP also seeks to ensure markets for cooperatives' products and to help arrange contracts with state institutions and enterprises through business summits. The agency works to integrate small and medium enterprises with cooperatives in production chains and to facilitate contracts with foreign buyers through bilateral agreements. Although cooperatives are expected to initially produce for self-sufficiency and local markets they can reach with their own resources, production for national and foreign markets is also actively pursued. The principal idea is that cooperatives (or development zones) should integrate with other cooperatives (or development zones) to add value through processing and transformation and to distribute and commercialize goods while avoiding intermediaries.
Critics of these policies of the Chavez administration point to the increasing corruption resulting from the handling of credits to cooperatives. Although there is always a way of circumventing a set of rules, MINEP's funding institutions try to prevent this by tightening loans to the list of specific resources mentioned in the project, which the cooperatives obtain in kind. More importantly, new legal mechanisms established in the Bolivarian Constitution -- the Ley Contra la Corrupción (Law against Corruption, 2003), the Ley Orgánica de Contraloría General de la República (Organic Law for the General Auditor of the Republic, 2003) and Ley Orgánica de la Administración Pública (Organic Law for the Public Administration) -- allow all citizens to exert "social control" of state resources and make public officials accountable. However, the permanence in public institutions of inherited bureaucrats who are not committed to change, or who use their positions to sabotage the process, seems to be limiting the effectiveness of these mechanisms for social control.
Once oil prices go down, the revenues to fund endogenous development polices will have been lost, critics also argue. Many worry about the size of Venezuela's oil reserves and have predicted 25-100 years of supply. However, by investing in human capital and promoting small and medium enterprises, the Chavez administration is basically doing what most economists, including neoliberals, have advised. It could be the case that cooperatives are not the most economically efficient way of allocating a nation's resources, but until a different way of democratizing the economy appears, it seems like a desirable alternative. Although the implementation of these policies is not free from problems, if we consider the limitations and ills of large-scale industrialization, it is hard to envision a better way to create employment, stimulate the economy, and reduce dependency on exports.
In numerous press reports and personal interviews, SUNACOOP's superintendent and other officials have admitted that there are many deficiencies among the newly formed cooperatives, mainly due to a lack of cooperative values and administrative skills. MINEP's minister acknowledged that some regular enterprises "have been transformed into cooperatives, but not with the intention of transferring power to their workers . . . but to evade national taxes from which cooperatives are exempt."20 Of the irregularities detected by SUNACOOP in the fewer than 300 cooperatives audited by July 2005, 50 percent involved bookkeeping and administrative wrongdoings, 30 percent stemmed from the exclusion of members from surpluses, 22 percent from undemocratic decision-making, and one percent from subcontracting wage workers for more than temporary (3-6 months) periods.21 Many steps have been taken in order to remedy these deficiencies, which also resulted from the fact that SUNACOOP was not prepared to deal with such a rapid increase in the number of cooperatives. Indeed, SUNACOOP operated with only eight auditors, though each audit requires an average of two days.22 Since June 2005, SUNACOOP has launched an accelerated effort to certify and audit all cooperatives in order to identify problems and address them. They now have at least one auditor in each of the 24 states (as part of the decentralization process), in addition to six auditors in Caracas, and are planning to audit 1,742 cooperatives from September to December 2005.23 The plan is to audit all cooperatives in order to provide them with a "pedagogical" evaluation, including recommendations and measures that must be taken in order to avoid sanctions or cancellation. SUNACOOP's budget has been increased and will receive more personnel, equipment, and technology. Since "cooperativism has become a transversal axis of the national government's public policies," SUNACOOP is expected to work in conjunction not only with MINEP but also with other state institutions.24 In August 2005, they concluded the first round of a series of meetings to discuss the situation of the cooperative movement and obtain inputs for policy suggestions and changes that should be made to rules and laws. These meetings are also an attempt to push towards the integration of the new cooperative movement with the traditional or pre-Chavez Venezuelan cooperative movement.
When talking to members of Venezuela's traditional cooperative movement, I noticed that, although they had been invited to participate in the writing of the Law of Cooperatives, they felt excluded from policy making. They argued that the government's promotion of cooperatives is irresponsible and opportunistic because they have made it too easy to create a cooperative (the requirement of proving feasibility was eliminated) and that they are being used for political agendas. Most new cooperatives are doomed to failure, critics say, because they are dependent on state resources and they lack management and administrative skills. They also criticize MINEP for creating cooperatives with members who don't share the cooperative values and for corrupting them by providing easy credit and too much paternalistic aid. At times when the political debate over the Chavez administration in Venezuela was highly divisive, tensions ran strong.
But there are signs that the relationship is improving, as SUNACOOP publicly invited these traditional cooperatives to participate in the debates over a cooperative national council and revision of the laws. In September 2005, the Venezuelan Foreign Ministry held a meeting with the National Central of Venezuelan Cooperatives (CECONAVE, the main integration body of the traditional cooperative movement) to explore ways to support them, especially to help them access external markets, and to learn from their successful experiences.25
It's still too early to assess the real impact of cooperatives in Venezuela. But it wouldn't be totally misguided to assert that they have contributed to the increase in formal employment26 and economic output not derived from oil exports.27 Most importantly, the new cooperatives in Venezuela are expected to be committed to the wellbeing of the community in which they are located. In articles three and four of the 2001 Law of Cooperatives, it's stated that "social responsibility" and "commitment to the community" are, respectively, among the values and principles of cooperatives. In interviews with 25 cooperatives I could observe that these ideas were widely shared. Regardless of their short life and scant resources, many cooperatives have made donations to the community and provided temporary employment to those who are most desperate. Groups of socially-conscious community activists have created non-profit cooperatives to provide much-needed services and improve their communities' standard of living. To consolidate this "social responsibility," the Chavez administration is urging cooperatives and other enterprises to become Empresas de Produccion Social (Social Production Enterprises -- EPS), which are expected to be highly responsive to the communities in which they are located.
Even if many of the new cooperatives fail, it doesn't mean that the promotion of cooperatives is an undesirable development policy. Rather, it shows that development requires effective state support in providing both education and resources to break with the cycle of poverty and underdevelopment. As Chavez has said, borrowing from Bolivar's teacher Simon Rodríguez: "if we don't try, we've already made a mistake" ("o inventamos o erramos"). The key to the success of the new cooperatives in Venezuela is to find a balance between voluntarism and pragmatism, so that the impetus for change is effectively translated into concrete and lasting transformation.
1 575 cooperatives have been contracted for more than $3.2 million worth of services in 2004, and for nearly $3 million from January to June 2005 (CADELA, "Informe NO. 21040-0000-26," July 2005).
2 In 2004, 50 percent of all the projects in the municipality were carried out by 170 cooperatives, amounting to almost $1 million (Marta Harnecker, La Experiencia del Presupuesto Participativo de Caracas, December 2004].
3 SUNACOOP, "Monthly Report" (August 2005).
4 Greg Albo, "Venezuela under Chávez: the Bolivarian Revolution against Neo-liberalism," The Unexpected Revolution: the Venezuelan People Confront Neo-Liberalism (Socialist Interventions Pamphlet Series. March 2005).
5 Economic Commission for Latin America and the Caribbean (ECLAC), Statistical Yearbook for Latin America and the Caribbean, 2004 (Santiago: United Nations Publication, April 2005).
6 PROVEA, Situación de los Derechos Humanos en Venezuela: Informe Anual: Oct. 2003- Sept. 2004 (Caracas, 2004), pp. 57.
7 MINEP, Informe de Gestión para la Asamblea General de la OEA (May 2005).
8 Ibid.
9 Ibid.
10 Ibid.
11 Ibid.
12 Ibid.
13 Ministry of Communications and Information: Taller de Alto Nivel “El nuevo mapa estratégico.” September 2004.
14 MINEP: Informe de Gestión para la Asamblea General de la OEA. May 2005.
15 Of the total number of cooperatives, 54 percent are in goods and services production, 30 percent are in agricultural production, 9 percent in transportation, 4 percent in social services, 2 percent in consumption, and 1 percent in savings and credits (SUNACOOP, "Monthly Report," August 2005).
16 Ibid.
17 MINEP, "Financiadas 60% de cooperativas de Vuelvan Caras: MINEP inicia gabinetes regionales" (September 2005).
18 Ibid.
19 MINEP, "Vuelvan Caras II buscará consolidar el modelo económico cooperativista" (September 2005).
20 SUNACOOP, "Presupuesto Nacional 2006: MINEP destina 13 millardos de bolívares para SUNACOOP" (September 2005).
21 SUNACOOP, "Plan de Fiscalización Nacional de Cooperativas" (September 2005); and other reports.
22 Declarations of SUNACOOP's audit department officials.
23 SUNACOOP, "Plan de Fiscalización Nacional de Cooperativas" (September 2005).
24 SUNACOOP, "SUNACOOP profundiza vigilancia en las cooperativas" (September 2005).
25 Patrick J. O'Donoghue, "Foreign Ministry (MRE) to Help Venezuelan Cooperative Movement to Expand Abroad," VHeadline (16 September 16 2005).
26 The unemployment rate decreased from 16.8% in 2003 to 13.7% in 2004. Most significantly, the employment rate in the formal sector increased from 47.3% in 2003 to 54.2% in January-June 2005 and the employment rate in the informal sector decreased from 52.7% in 2003 to 45.8% in 2005 (National Statistics Institute: June 2005).
27 In the first semester of 2005, construction grew at 20.3%, commerce and non-governmental services at 20.3% and manufacture at 12.4 % (Governmental Economic Report. 2005 at http://www.gobiernoenlinea.gob.ve).
Camila Piñeiro Harnecker is a graduate student in Latin American Studies at the University of California, Berkeley. A native of Cuba, she is currently researching the impact of participatory democracy on community development in Venezuela.
Monthly Review
December 5, 2005
I arrived in Caracas in July 2005 with a few contacts at different cooperatives, anxious about how I would sort through the more than 70,000 cooperatives that the Superintendencia Nacional de Cooperativas (National Superintendence of Cooperatives -- SUNACOOP) had referred to in its recent press statements. Indeed, I found cooperatives everywhere. Between one night and the next morning, I stumbled on cooperatives in some rather unexpected places: a group of artisans in the neighborhood near my hotel, a group of tour guides who entertained children in a nearby park, the cleaning crew of an office building where I went to conduct an interview. Even the taxi drivers in front of the hotel where I was staying had left their private employer to form a cooperative.
Spaces for small enterprises, especially cooperatives, have been opened by a great number of local governments, public institutions, and enterprises, including Venezuela's oil company, PDVSA. These agencies have established contract-bidding procedures that, while demanding competitive quality and costs, don't discriminate against small enterprises and cooperatives. They have also encouraged workers employed by private contractors to form cooperatives. For example, CADELA, one of the five regional branches of the state-owned national electric company, encouraged its maintenance and security subcontract workers to leave their private employers and form their own cooperatives. CADELA is an enterprise under co-management and has been very supportive of cooperatives.1 Similarly, most of the stations of Caracas's state-owned rapid transportation system are maintained by cooperatives created by employees of former private businesses. The Public Works Division of Caracas's main municipality has promoted Local Works Cabinets (Gabinetes de Obras Locales) through which neighbors organize themselves in working tables to decide which public works on infrastructure should be done and supervise them. The community also decides which cooperatives in the neighborhood carry out the work.2
When President Hugo Chavez assumed power in 1998, there were only 762 cooperatives in Venezuela.3 These cooperatives, as the rest of Venezuelan society, had survived the structural adjustment measures started by the presidency of Carlos Andres Perez in 1989. In the two decades before the rise of Chavez, Venezuelan GDP fell almost continuously, and inequality became extreme. An estimated 80 percent of the population lived in poverty and more than half of the employment was in the informal sector.4 The Venezuelan economy is also heavily dependent on oil revenue, with most of its GDP coming from oil exports.5 Much of the food is imported, well under FAO's minimum food production levels for food self-sufficiency.6
To deal with this social and economic situation, the Chavez administration has embraced a new development model, referred to as "endogenous development." Its conceptualization draws heavily from Osvaldo Sunkel's ideas in Development from Within: Toward a Neostructuralist Approach for Latin America (1993) which calls for an adaptation of import substitution policies which prioritize equity, human development, and development adjusted to specific local conditions and employing local resources. The official interpretation of endogenous development also emphasizes the importance of local, diversified, and sustainable development, and the commitment to respect Venezuelans' different cultures and identities.7 Most significantly, committed to including the historically-marginalized sectors of the Venezuelan society, the Chavez government also recognizes the need to democratize the economy, combat inequalities, and encourage solidarity in order to pay the accumulated "social debt" to the popular sectors.
The cooperative production model has increasingly come to define the development strategies of the "Bolivarian Revolution." In its August 2005 report, SUNACOOP registered a total of 83,769 cooperatives, with more than 40,000 cooperatives created in 2004 and almost 30,000 more cooperatives formed in the first eight months of 2005. The total number of associates in October 2004 was 945,517, up from 215,000 in 1998.
This proliferation originates in the recognition of cooperatives throughout the 1999 Bolivarian Constitution as key economic actors within the nation's social economy, portrayed as tools for economic inclusion, participation (article 70), and state decentralization (article 184). More significantly, the state is expected to "promote and protect" cooperatives (articles 118 and 308). It wasn't until the Ley Especial de Asociaciones Cooperativas (Special Law of Cooperative Associations) was published in September 2001 that numbers started growing with almost 1,000 cooperatives in 2001, more than 2,000 in 2002, and more than 8,000 in 2003.8
In March 2004, the Misión Vuelvan Caras was created to "change the nation's economic, social, political and cultural model in order to attain a State of Justice and Law sustained by an endogenous socio-economic development, as asserted in the Bolivarian Constitution."9 Most students were recent graduates from other educational missions that allowed Venezuelans to finish primary and secondary education. The missions are social programs to promote education, health, and culture, funded by the surplus from oil revenues and managed directly by the executive. They were created by the Chavez administration as parallel structures to avoid the bureaucracy inherited by the existing ministries.
Through Vuelvan Caras, between December 2004 and May 2005, 264,720 students graduated from semester- to year-long classes on technical, managerial, and historical subjects, as well as on citizenship and cooperative values. During this period, students received scholarships and opportunities to improve their quality of life, especially health and housing conditions. Although graduates from Vuelvan Caras are free to seek individual employment or form micro-enterprises by themselves, it was made clear that cooperatives were a preferable form of organization which would be prioritized for state support. Students in the mission were encouraged to form cooperatives, and 195,095 graduates, or nearly 70 percent, did, resulting in 7,592 new cooperatives.10
In September 2004, the Venezuelan government created a Ministerio de Economía Popular (Ministry of Popular Economy -- MINEP) to support and institutionalize the Vuelvan Caras program, and to coordinate the work of the existing and newly-created lending institutions. Its role is to coordinate and draft policies to promote micro-enterprises, cooperatives, and other self-sustaining productive units that contribute to collective wellbeing and dignify productive labor.11 MINEP's publications maintain that Vuelvan Caras is not an employment program and that cooperatives are not promoted in order to fulfill its commitment to provide employment for all Vuelvan Caras graduates -- rather, cooperatives are seen as a central component of "an economic model whose raison d’être is collective wellbeing rather than capital accumulation."12
After the Chavez government won a recall referendum that left his opponents reeling, Chavez defined the "new strategic map" for a subsequent stage of the "Bolivarian Revolution" in a meeting with government officials in November 2004. Among the 10 strategic objectives that Chavez mentioned was the commitment to "advance in the conformation of a new social structure," to establish "a new democratic model of popular participation," and to "speed up the construction of a new productive model towards the formation of a new economic system."13
The creation and support of cooperatives integrated in Núcleos de Desarrollo Endógeno (Endogenous Development Zones - NUDEs) by MINEP is a key strategy towards that aim. A NUDE is formed by one or more Vuelvan Caras' cooperatives that join to design a project, with the assistance of MINEP's specialists, for a physical space (land, factories, installations) they have identified and can be made available by MINEP. When the project proposal is finished and accepted, the cooperatives receive on-site technical support, the necessary credit (generally at zero interest and with some grace period), and the physical space (generally provided in usufruct). In May 2005, there were 115 active development zones with a total of 27,975 Vuelvan Caras graduates (near 10 percent of all graduates) in 960 cooperatives (near 12 percent of all cooperatives created within the mission) -- 73.5 percent in agriculture with 20,411 graduates in 699 cooperatives; 14.8 percent in industry with 4,377 graduates in 155 cooperatives; and 10.4 percent in tourism with 3,063 graduates in 103 cooperatives.14
Visiting one NUDE specializing in manufacturing, one specializing in agriculture, and another specializing in tourism, I could observe a great deal of the efforts required and difficulties involved in establishing a NUDE. MINEP's specialists provided constant on-site technical assistance and pushed bureaucracy so that the infrastructure and inputs that cooperatives were supposed to obtain from public institutions, as it was stated in their contracts, were actually delivered. Most cooperative members referred to internal communication problems as the greatest challenge but seemed to be hopeful that time and practice under equal rights would solve them. Most cooperative members have little administrative and management skills, and only few have started taking the classes on management and administration provided by MINEP. However, most cooperatives I talked to seemed to be very aware of the importance of productivity. Their commitment to productivity is not only moral ("Vuelvan Caras has to be a success") but also rational in the economic sense. In order to receive new credits and maintain the resources given in usufruct, cooperatives have to pay off their loans and comply with their contracts.
The majority of the cooperatives are in the production of goods and services and in agriculture.15 MINEP's focus on agricultural and manufacturing cooperatives is indicative of the priority given to production of goods necessary to meet basic needs. It is also consistent with the Chavez administration's aim of achieving food security and reducing dependency on imports of other products to satisfy basic needs.
Since March 2005, MINEP has been in the process of installing regional technical committees to decentralize its functions and services. Each regional technical committee encapsulates all state institutions subordinate to MINEP, including SUNACOOP, the National Institute for Cooperative Education (INCE, which provides most of the logistics and specialists), and the six specialized funding institutions, several of them created by the Chavez government. The aim is to create a decentralized "synergy" of public institutions characterized by public accessibility and administrative transparency, allowing more citizen oversight. Additionally, this organizational approach is designed to prevent bureaucratization, inefficiency, corruption, and other evils. Towards its goal of placing all graduates, MINEP soon plans to activate another 140 development zones.16 It also aims to provide funding for all Vuelvan Caras cooperatives, 60 percent of which (4,036) have already received more than $265 million, while an additional 30 percent were expected to receive it in September 2005.17
In September 2005, MINEP held the first of a series of regional meetings with the goal of "debating and solving strategic aspects of the Vuelvan Caras mission's performance in each state of the country."18 Once all cooperatives and development zones are active (having received installations, technical assistance, and credit if necessary), MINEP plans to start a new cycle of the Vuelvan Caras mission. Vuelvan Caras II is expected to start in January 2006 with more than 700,000 students and hopes to organize them in another 2,000 cooperatives.19
In addition to providing technical assistance, infrastructure, and credits for cooperatives and micro-enterprises, MINEP also seeks to ensure markets for cooperatives' products and to help arrange contracts with state institutions and enterprises through business summits. The agency works to integrate small and medium enterprises with cooperatives in production chains and to facilitate contracts with foreign buyers through bilateral agreements. Although cooperatives are expected to initially produce for self-sufficiency and local markets they can reach with their own resources, production for national and foreign markets is also actively pursued. The principal idea is that cooperatives (or development zones) should integrate with other cooperatives (or development zones) to add value through processing and transformation and to distribute and commercialize goods while avoiding intermediaries.
Critics of these policies of the Chavez administration point to the increasing corruption resulting from the handling of credits to cooperatives. Although there is always a way of circumventing a set of rules, MINEP's funding institutions try to prevent this by tightening loans to the list of specific resources mentioned in the project, which the cooperatives obtain in kind. More importantly, new legal mechanisms established in the Bolivarian Constitution -- the Ley Contra la Corrupción (Law against Corruption, 2003), the Ley Orgánica de Contraloría General de la República (Organic Law for the General Auditor of the Republic, 2003) and Ley Orgánica de la Administración Pública (Organic Law for the Public Administration) -- allow all citizens to exert "social control" of state resources and make public officials accountable. However, the permanence in public institutions of inherited bureaucrats who are not committed to change, or who use their positions to sabotage the process, seems to be limiting the effectiveness of these mechanisms for social control.
Once oil prices go down, the revenues to fund endogenous development polices will have been lost, critics also argue. Many worry about the size of Venezuela's oil reserves and have predicted 25-100 years of supply. However, by investing in human capital and promoting small and medium enterprises, the Chavez administration is basically doing what most economists, including neoliberals, have advised. It could be the case that cooperatives are not the most economically efficient way of allocating a nation's resources, but until a different way of democratizing the economy appears, it seems like a desirable alternative. Although the implementation of these policies is not free from problems, if we consider the limitations and ills of large-scale industrialization, it is hard to envision a better way to create employment, stimulate the economy, and reduce dependency on exports.
In numerous press reports and personal interviews, SUNACOOP's superintendent and other officials have admitted that there are many deficiencies among the newly formed cooperatives, mainly due to a lack of cooperative values and administrative skills. MINEP's minister acknowledged that some regular enterprises "have been transformed into cooperatives, but not with the intention of transferring power to their workers . . . but to evade national taxes from which cooperatives are exempt."20 Of the irregularities detected by SUNACOOP in the fewer than 300 cooperatives audited by July 2005, 50 percent involved bookkeeping and administrative wrongdoings, 30 percent stemmed from the exclusion of members from surpluses, 22 percent from undemocratic decision-making, and one percent from subcontracting wage workers for more than temporary (3-6 months) periods.21 Many steps have been taken in order to remedy these deficiencies, which also resulted from the fact that SUNACOOP was not prepared to deal with such a rapid increase in the number of cooperatives. Indeed, SUNACOOP operated with only eight auditors, though each audit requires an average of two days.22 Since June 2005, SUNACOOP has launched an accelerated effort to certify and audit all cooperatives in order to identify problems and address them. They now have at least one auditor in each of the 24 states (as part of the decentralization process), in addition to six auditors in Caracas, and are planning to audit 1,742 cooperatives from September to December 2005.23 The plan is to audit all cooperatives in order to provide them with a "pedagogical" evaluation, including recommendations and measures that must be taken in order to avoid sanctions or cancellation. SUNACOOP's budget has been increased and will receive more personnel, equipment, and technology. Since "cooperativism has become a transversal axis of the national government's public policies," SUNACOOP is expected to work in conjunction not only with MINEP but also with other state institutions.24 In August 2005, they concluded the first round of a series of meetings to discuss the situation of the cooperative movement and obtain inputs for policy suggestions and changes that should be made to rules and laws. These meetings are also an attempt to push towards the integration of the new cooperative movement with the traditional or pre-Chavez Venezuelan cooperative movement.
When talking to members of Venezuela's traditional cooperative movement, I noticed that, although they had been invited to participate in the writing of the Law of Cooperatives, they felt excluded from policy making. They argued that the government's promotion of cooperatives is irresponsible and opportunistic because they have made it too easy to create a cooperative (the requirement of proving feasibility was eliminated) and that they are being used for political agendas. Most new cooperatives are doomed to failure, critics say, because they are dependent on state resources and they lack management and administrative skills. They also criticize MINEP for creating cooperatives with members who don't share the cooperative values and for corrupting them by providing easy credit and too much paternalistic aid. At times when the political debate over the Chavez administration in Venezuela was highly divisive, tensions ran strong.
But there are signs that the relationship is improving, as SUNACOOP publicly invited these traditional cooperatives to participate in the debates over a cooperative national council and revision of the laws. In September 2005, the Venezuelan Foreign Ministry held a meeting with the National Central of Venezuelan Cooperatives (CECONAVE, the main integration body of the traditional cooperative movement) to explore ways to support them, especially to help them access external markets, and to learn from their successful experiences.25
It's still too early to assess the real impact of cooperatives in Venezuela. But it wouldn't be totally misguided to assert that they have contributed to the increase in formal employment26 and economic output not derived from oil exports.27 Most importantly, the new cooperatives in Venezuela are expected to be committed to the wellbeing of the community in which they are located. In articles three and four of the 2001 Law of Cooperatives, it's stated that "social responsibility" and "commitment to the community" are, respectively, among the values and principles of cooperatives. In interviews with 25 cooperatives I could observe that these ideas were widely shared. Regardless of their short life and scant resources, many cooperatives have made donations to the community and provided temporary employment to those who are most desperate. Groups of socially-conscious community activists have created non-profit cooperatives to provide much-needed services and improve their communities' standard of living. To consolidate this "social responsibility," the Chavez administration is urging cooperatives and other enterprises to become Empresas de Produccion Social (Social Production Enterprises -- EPS), which are expected to be highly responsive to the communities in which they are located.
Even if many of the new cooperatives fail, it doesn't mean that the promotion of cooperatives is an undesirable development policy. Rather, it shows that development requires effective state support in providing both education and resources to break with the cycle of poverty and underdevelopment. As Chavez has said, borrowing from Bolivar's teacher Simon Rodríguez: "if we don't try, we've already made a mistake" ("o inventamos o erramos"). The key to the success of the new cooperatives in Venezuela is to find a balance between voluntarism and pragmatism, so that the impetus for change is effectively translated into concrete and lasting transformation.
1 575 cooperatives have been contracted for more than $3.2 million worth of services in 2004, and for nearly $3 million from January to June 2005 (CADELA, "Informe NO. 21040-0000-26," July 2005).
2 In 2004, 50 percent of all the projects in the municipality were carried out by 170 cooperatives, amounting to almost $1 million (Marta Harnecker, La Experiencia del Presupuesto Participativo de Caracas, December 2004].
3 SUNACOOP, "Monthly Report" (August 2005).
4 Greg Albo, "Venezuela under Chávez: the Bolivarian Revolution against Neo-liberalism," The Unexpected Revolution: the Venezuelan People Confront Neo-Liberalism (Socialist Interventions Pamphlet Series. March 2005).
5 Economic Commission for Latin America and the Caribbean (ECLAC), Statistical Yearbook for Latin America and the Caribbean, 2004 (Santiago: United Nations Publication, April 2005).
6 PROVEA, Situación de los Derechos Humanos en Venezuela: Informe Anual: Oct. 2003- Sept. 2004 (Caracas, 2004), pp. 57.
7 MINEP, Informe de Gestión para la Asamblea General de la OEA (May 2005).
8 Ibid.
9 Ibid.
10 Ibid.
11 Ibid.
12 Ibid.
13 Ministry of Communications and Information: Taller de Alto Nivel “El nuevo mapa estratégico.” September 2004.
14 MINEP: Informe de Gestión para la Asamblea General de la OEA. May 2005.
15 Of the total number of cooperatives, 54 percent are in goods and services production, 30 percent are in agricultural production, 9 percent in transportation, 4 percent in social services, 2 percent in consumption, and 1 percent in savings and credits (SUNACOOP, "Monthly Report," August 2005).
16 Ibid.
17 MINEP, "Financiadas 60% de cooperativas de Vuelvan Caras: MINEP inicia gabinetes regionales" (September 2005).
18 Ibid.
19 MINEP, "Vuelvan Caras II buscará consolidar el modelo económico cooperativista" (September 2005).
20 SUNACOOP, "Presupuesto Nacional 2006: MINEP destina 13 millardos de bolívares para SUNACOOP" (September 2005).
21 SUNACOOP, "Plan de Fiscalización Nacional de Cooperativas" (September 2005); and other reports.
22 Declarations of SUNACOOP's audit department officials.
23 SUNACOOP, "Plan de Fiscalización Nacional de Cooperativas" (September 2005).
24 SUNACOOP, "SUNACOOP profundiza vigilancia en las cooperativas" (September 2005).
25 Patrick J. O'Donoghue, "Foreign Ministry (MRE) to Help Venezuelan Cooperative Movement to Expand Abroad," VHeadline (16 September 16 2005).
26 The unemployment rate decreased from 16.8% in 2003 to 13.7% in 2004. Most significantly, the employment rate in the formal sector increased from 47.3% in 2003 to 54.2% in January-June 2005 and the employment rate in the informal sector decreased from 52.7% in 2003 to 45.8% in 2005 (National Statistics Institute: June 2005).
27 In the first semester of 2005, construction grew at 20.3%, commerce and non-governmental services at 20.3% and manufacture at 12.4 % (Governmental Economic Report. 2005 at http://www.gobiernoenlinea.gob.ve).
Camila Piñeiro Harnecker is a graduate student in Latin American Studies at the University of California, Berkeley. A native of Cuba, she is currently researching the impact of participatory democracy on community development in Venezuela.
Bolivia: The Agrarian Reform That Wasn't
Written by Leila Lu
Upside Down World
Wednesday, 07 December 2005
According to the United Nations, as of October 2005, 100 families control over 25 million hectares of land in Bolivia while 2 million campesino (farmer/peasant) families have, combined, access to 5 million hectares of land. In other words, the wealthiest 100 landowners possess five times more land then 2 million small landowners.*
The UN Development Report goes on to state that it is precisely this inequality that is the principal cause of Bolivia’s political and social instability, fuelling constant conflicts between a tiny elite and the general population.
According to the World Bank, in Latin America the average discrepancy between the wealth of the richest fifth of the population and the poorest fifth of the population is 30:1. In Bolivia it is 90:1. If cities are excluded from the measurement, it is 170:1.
But What About Agrarian Reform?
After 52 years of agrarian reform, Bolivian agriculture is divided into two distinct tendencies: enormous latifundios (estates), vast territories in which only a small part is used for productive agriculture, and hundreds of thousands of tiny, over cultivated properties owned by indigenous and/or campesino farmers. Despite the fact that campesino farmers occupy a much smaller portion of land, they have higher agricultural productivity and supply more food to the local economy then the latifundios, which overwhelmingly cultivate plantation-style agriculture – vast expanses of a single crop such as soya, sugar, rice or cotton destined for export and dependant on the usage of large quantities of pesticides and fertilizers.
So how is it that after a peasant revolution in 1952 and more then fifty years of agrarian reform, today the average campesino from the west or center of the country has less land then they started with?
Technically, the agrarian reform laws are still on the books. All land must complete a social/economic function, or else it reverts back to the state. The state engaged in an intensive process of land grants and agricultural development financing throughout the 50s, 60 s, 70 s and 80 s. On paper, Bolivia should be a reformed country. However…
The more things change…
Since colonization by the Spanish, the territory to-be known as Bolivia has been marked by political and economic domination of a small elite and a feudal economic system. Independence did not result in a full break of the social structures set in place by Spain. In effect, feudal structures such as haciendas and latifundios (large landholdings worked by indigenous labour without pay) remained practically unchanged throughout the first epoch of the Republic’s history, especially in the eastern provinces of Santa Cruz, Beni and Pando (collectively known as the Oriente or Tierras Bajas). According to Carlos Ramiro Bonifaz, director of the Centre of Judicial Studies and Social Investigation, the dominant land-owning classes of the region developed systems of wealth accumulation based on the exploitation of the indigenous labour force (ie charging workers exorbitant prices for basic necessities, resulting in the creation of debt and subsequent servitude), rather then the re-investment of capital or technological development. Instead, the wealth of elites went towards the purchase of imported status symbols.
After the Revolution of 1952, a land reform program was implemented which aimed to change these tendencies. The program was directly influenced by the US-authored Plan Bohan, with the goal of state-led capitalization and industrialization of agriculture (hopefully diffusing peasant unrest while simultaneously providing a new market for US produced agri-chemicals and machinery.) Large properties were designated the social function of "agricultural enterprises", lent prodigious amounts of money with which to obtain modern technology, and informed that they were now obliged to pay salaries (food and clothing also considered acceptable currency) to the influx of workers and settlers arriving from the western part of the country. Interestingly enough, of these loans, $24.7 million went to 114 debtors, while a further $24.8 million went to a clearly needy 27 individuals.
Land Grants
This process was accompanied by an extensive program of land grants. From 1953 to 1993, more than 26 million hectares of land were granted in the Oriente. However, of this land, more then 87.5% was given to the wealthiest (in terms of property ownership) half of recipients, while the remaining half received 12.5% of grants. Today, 55% of farm properties are squeezed into less the one percent of cultivated land.
It is important to remember that almost all of the "unowned" land that was granted was in fact inhabited by indigenous populations. In effect, the land reform program was used by the dominant classes to extend their holdings and develop interests in commercial agriculture and modern ranching. In the years of the Banzer dictatorship (1971-1978), this cronyism reached staggering proportions – 116, 647 hectares granted to the Antelo family, 96,874 hectares granted to the Gutierrez family, 115,646 hectares granted to the Elsner family (plus 73,690 hectares given individually to Guillermo Bauer Elsner), etc…
Debt Forgiveness
All this, however, apparently was not enough to ensure the success of the Agricultural Enterprises. Due to the persistent habit of loans remaining unpaid, the Agricultural Bank was forced to close in the 1980´s – this after a state-ordered forgiveness of 44.5 million dollars in loans belonging to some 726 cotton-enterprise owners and some 188 soy enterprise-owners. Not to mention absorption of some 5.8 million dollars in private debts with the Bank of Brasil and 1.8 million dollars in private debts with CitiBank. The combined effect of these pardons was one of the major causes of the hyperinflation that Bolivia experienced in the 1980´s, resulting in the further impoverishment of the general population and an IMF imposed stabilization program that gutted useless public services such as health and education and privatized the profitable ones.
The Drug Problem
And thus, suffering from such arduous financial difficulties, many members of the Santa Cruz elite had no alternative but to turn to the trafficking of cocaine to feed their families. Luckily "…control of the political apparatus had allowed narco-traffickers to gain control over large expanses of land in Santa Cruz and Beni", and they "received direct political protection from government forces, especially from the Ministry of the Interior and the President of the Republic himself during the years of military regimes, making up an alliance between sections of the armed forces and the trafficking mafia." (Romero Bonifaz 69)
Significant sections of the agro industrialist landowning class were involved in narco-trafficking. To quote a friend, waving his hand towards the walled mansions of the neighborhood Las Palmas "…all this is drug money from the eighties. All the money here is, even if it’s indirectly like through building the mansions for dealers."
(This leads us to the issue of coca growing campesinos and US-lead repression/militarization, which will have to be explored in depth another day…)
Impunity
When control of the political apparatus is not sufficient to gain desired results, large landowners often turn to violence.
"Between November 2001 and the end of 2002, 10 campesinos were murdered in the Oriente due to conflicts over land, and many social leaders, institutional representatives, human rights defenders etc have been victims of criminal aggression from those who would prefer that the situation of agrarian rights is not clarified."
The current situation in the eastern lowlands of Bolivia is one in which a small elite dominates the political process, with the result that the primary function of government has been to oversee their interests and protect the existing status quo from turbulence. Unlike the western part of the country (Occidente/Tierras Altas), where well organized movements demanding a redistribution of power have achieved a situation where they are capable of shutting down business-as-usual and changing state policies detrimental to the majority of the population (reversing water privatization, gas exports, etc) and have a clearly articulated program for change (an end to the disastrous neoliberal experiment, nationalization and industrialization of gas, real land reform, creation of a directly democratic Constituent Assembly, reconstitution of indigenous territory and sovereignty, and the creation of a pluri-national state), the balance of power in the Oriente is still in the hands of the oligarchy.
This is not to say that people are not organizing – there is an active Landless Movement (MST), and indigenous and campesino organizations and confederations – but the process is nascent in comparison with the Occidente.
Autonomia Ya!!!
A response to the shift in power in the Occidente and the very real possibility of the December election bringing to power a populist government promising to nationalize the country’s gas reserves and enact land reform (MAS, led by cocolero Evo Morales who also would be the country’s first indigenous president – considering that 62% of the population identified as indigenous in the 2002 census, the fact that it has taken this long is instructive as to the level of institutional racism existent in the political system) has been the emergence of a nationalist separatist/autonomy movement in the Oriente, financed by petroleros and Cruceñan society (in particular the Comite Pro-Santa Cruz), playing on existing themes of the central government in La Paz taking an unfair share of the provinces revenues, and regionalism/pride in the cultural identity of "camba".
Green and white flags flutter and stickers reading "Nacion Camba: Mi Unica Patria" (Camba Nation: My Only Fatherland) adorn walls. Political parties vie to undo each other in their passionate declarations of desire for Autonomia.
However, Bolivia is not neatly divided into two distinct halves. A direct result of land scarcity has been migration to urban centers, and migration from the Occidente to the Oriente. In Santa Cruz one overhears Quechua and Ayamara being spoken, and many inhabitants of the city have origins in other areas of the country. The story of a single homogenous identity is, as always, little but a useful tool.
The real frustration that people feel with the central government in La Paz, with all government, will not be resolved by this "autonomy", or any other measure that does not deal with the reality of the state serving as a direct instrument of class oppression and protector of the interests of the privileged elite. What is needed is redistribution – of land and of decision making power. The way to peace in Bolivia is very simple: justice.
####
*These figures do not include the at least 250,000 campesinos without land.
Sources:
"Cien Clanes Familiares Son Dueñoes de 25 Milliones de Hectareas en Bolivia", Conosur Nawpaqman No. 115, Oct. 2005, published by Centro de Comunicación y Desarrollo Andino, Cochabamba, Bolivia. www.cenda.org
Carlos Romero Bonifaz: "La Reforma Agraria en las tierras bajas de Bolivia", Articulo Primero No. 14, Oct. 2003, published by Centro de Estudios Jurídicos E Investigación Social, Santa Cruz, Bolivia
Ferrant,/Perri,/Ferreira/Walton: Desigualidades en America Latina y el Caribe ¿Ruptura con la Historia? Banco Mundial 2004, cited in Alvaro Garcia Linera: "La Lucha por el Poder en Bolivia", in "Horizontes y Limites del Estado y el Poder". Ediciones Muella del Diablo, 2005.
Upside Down World
Wednesday, 07 December 2005
According to the United Nations, as of October 2005, 100 families control over 25 million hectares of land in Bolivia while 2 million campesino (farmer/peasant) families have, combined, access to 5 million hectares of land. In other words, the wealthiest 100 landowners possess five times more land then 2 million small landowners.*
The UN Development Report goes on to state that it is precisely this inequality that is the principal cause of Bolivia’s political and social instability, fuelling constant conflicts between a tiny elite and the general population.
According to the World Bank, in Latin America the average discrepancy between the wealth of the richest fifth of the population and the poorest fifth of the population is 30:1. In Bolivia it is 90:1. If cities are excluded from the measurement, it is 170:1.
But What About Agrarian Reform?
After 52 years of agrarian reform, Bolivian agriculture is divided into two distinct tendencies: enormous latifundios (estates), vast territories in which only a small part is used for productive agriculture, and hundreds of thousands of tiny, over cultivated properties owned by indigenous and/or campesino farmers. Despite the fact that campesino farmers occupy a much smaller portion of land, they have higher agricultural productivity and supply more food to the local economy then the latifundios, which overwhelmingly cultivate plantation-style agriculture – vast expanses of a single crop such as soya, sugar, rice or cotton destined for export and dependant on the usage of large quantities of pesticides and fertilizers.
So how is it that after a peasant revolution in 1952 and more then fifty years of agrarian reform, today the average campesino from the west or center of the country has less land then they started with?
Technically, the agrarian reform laws are still on the books. All land must complete a social/economic function, or else it reverts back to the state. The state engaged in an intensive process of land grants and agricultural development financing throughout the 50s, 60 s, 70 s and 80 s. On paper, Bolivia should be a reformed country. However…
The more things change…
Since colonization by the Spanish, the territory to-be known as Bolivia has been marked by political and economic domination of a small elite and a feudal economic system. Independence did not result in a full break of the social structures set in place by Spain. In effect, feudal structures such as haciendas and latifundios (large landholdings worked by indigenous labour without pay) remained practically unchanged throughout the first epoch of the Republic’s history, especially in the eastern provinces of Santa Cruz, Beni and Pando (collectively known as the Oriente or Tierras Bajas). According to Carlos Ramiro Bonifaz, director of the Centre of Judicial Studies and Social Investigation, the dominant land-owning classes of the region developed systems of wealth accumulation based on the exploitation of the indigenous labour force (ie charging workers exorbitant prices for basic necessities, resulting in the creation of debt and subsequent servitude), rather then the re-investment of capital or technological development. Instead, the wealth of elites went towards the purchase of imported status symbols.
After the Revolution of 1952, a land reform program was implemented which aimed to change these tendencies. The program was directly influenced by the US-authored Plan Bohan, with the goal of state-led capitalization and industrialization of agriculture (hopefully diffusing peasant unrest while simultaneously providing a new market for US produced agri-chemicals and machinery.) Large properties were designated the social function of "agricultural enterprises", lent prodigious amounts of money with which to obtain modern technology, and informed that they were now obliged to pay salaries (food and clothing also considered acceptable currency) to the influx of workers and settlers arriving from the western part of the country. Interestingly enough, of these loans, $24.7 million went to 114 debtors, while a further $24.8 million went to a clearly needy 27 individuals.
Land Grants
This process was accompanied by an extensive program of land grants. From 1953 to 1993, more than 26 million hectares of land were granted in the Oriente. However, of this land, more then 87.5% was given to the wealthiest (in terms of property ownership) half of recipients, while the remaining half received 12.5% of grants. Today, 55% of farm properties are squeezed into less the one percent of cultivated land.
It is important to remember that almost all of the "unowned" land that was granted was in fact inhabited by indigenous populations. In effect, the land reform program was used by the dominant classes to extend their holdings and develop interests in commercial agriculture and modern ranching. In the years of the Banzer dictatorship (1971-1978), this cronyism reached staggering proportions – 116, 647 hectares granted to the Antelo family, 96,874 hectares granted to the Gutierrez family, 115,646 hectares granted to the Elsner family (plus 73,690 hectares given individually to Guillermo Bauer Elsner), etc…
Debt Forgiveness
All this, however, apparently was not enough to ensure the success of the Agricultural Enterprises. Due to the persistent habit of loans remaining unpaid, the Agricultural Bank was forced to close in the 1980´s – this after a state-ordered forgiveness of 44.5 million dollars in loans belonging to some 726 cotton-enterprise owners and some 188 soy enterprise-owners. Not to mention absorption of some 5.8 million dollars in private debts with the Bank of Brasil and 1.8 million dollars in private debts with CitiBank. The combined effect of these pardons was one of the major causes of the hyperinflation that Bolivia experienced in the 1980´s, resulting in the further impoverishment of the general population and an IMF imposed stabilization program that gutted useless public services such as health and education and privatized the profitable ones.
The Drug Problem
And thus, suffering from such arduous financial difficulties, many members of the Santa Cruz elite had no alternative but to turn to the trafficking of cocaine to feed their families. Luckily "…control of the political apparatus had allowed narco-traffickers to gain control over large expanses of land in Santa Cruz and Beni", and they "received direct political protection from government forces, especially from the Ministry of the Interior and the President of the Republic himself during the years of military regimes, making up an alliance between sections of the armed forces and the trafficking mafia." (Romero Bonifaz 69)
Significant sections of the agro industrialist landowning class were involved in narco-trafficking. To quote a friend, waving his hand towards the walled mansions of the neighborhood Las Palmas "…all this is drug money from the eighties. All the money here is, even if it’s indirectly like through building the mansions for dealers."
(This leads us to the issue of coca growing campesinos and US-lead repression/militarization, which will have to be explored in depth another day…)
Impunity
When control of the political apparatus is not sufficient to gain desired results, large landowners often turn to violence.
"Between November 2001 and the end of 2002, 10 campesinos were murdered in the Oriente due to conflicts over land, and many social leaders, institutional representatives, human rights defenders etc have been victims of criminal aggression from those who would prefer that the situation of agrarian rights is not clarified."
The current situation in the eastern lowlands of Bolivia is one in which a small elite dominates the political process, with the result that the primary function of government has been to oversee their interests and protect the existing status quo from turbulence. Unlike the western part of the country (Occidente/Tierras Altas), where well organized movements demanding a redistribution of power have achieved a situation where they are capable of shutting down business-as-usual and changing state policies detrimental to the majority of the population (reversing water privatization, gas exports, etc) and have a clearly articulated program for change (an end to the disastrous neoliberal experiment, nationalization and industrialization of gas, real land reform, creation of a directly democratic Constituent Assembly, reconstitution of indigenous territory and sovereignty, and the creation of a pluri-national state), the balance of power in the Oriente is still in the hands of the oligarchy.
This is not to say that people are not organizing – there is an active Landless Movement (MST), and indigenous and campesino organizations and confederations – but the process is nascent in comparison with the Occidente.
Autonomia Ya!!!
A response to the shift in power in the Occidente and the very real possibility of the December election bringing to power a populist government promising to nationalize the country’s gas reserves and enact land reform (MAS, led by cocolero Evo Morales who also would be the country’s first indigenous president – considering that 62% of the population identified as indigenous in the 2002 census, the fact that it has taken this long is instructive as to the level of institutional racism existent in the political system) has been the emergence of a nationalist separatist/autonomy movement in the Oriente, financed by petroleros and Cruceñan society (in particular the Comite Pro-Santa Cruz), playing on existing themes of the central government in La Paz taking an unfair share of the provinces revenues, and regionalism/pride in the cultural identity of "camba".
Green and white flags flutter and stickers reading "Nacion Camba: Mi Unica Patria" (Camba Nation: My Only Fatherland) adorn walls. Political parties vie to undo each other in their passionate declarations of desire for Autonomia.
However, Bolivia is not neatly divided into two distinct halves. A direct result of land scarcity has been migration to urban centers, and migration from the Occidente to the Oriente. In Santa Cruz one overhears Quechua and Ayamara being spoken, and many inhabitants of the city have origins in other areas of the country. The story of a single homogenous identity is, as always, little but a useful tool.
The real frustration that people feel with the central government in La Paz, with all government, will not be resolved by this "autonomy", or any other measure that does not deal with the reality of the state serving as a direct instrument of class oppression and protector of the interests of the privileged elite. What is needed is redistribution – of land and of decision making power. The way to peace in Bolivia is very simple: justice.
####
*These figures do not include the at least 250,000 campesinos without land.
Sources:
"Cien Clanes Familiares Son Dueñoes de 25 Milliones de Hectareas en Bolivia", Conosur Nawpaqman No. 115, Oct. 2005, published by Centro de Comunicación y Desarrollo Andino, Cochabamba, Bolivia. www.cenda.org
Carlos Romero Bonifaz: "La Reforma Agraria en las tierras bajas de Bolivia", Articulo Primero No. 14, Oct. 2003, published by Centro de Estudios Jurídicos E Investigación Social, Santa Cruz, Bolivia
Ferrant,/Perri,/Ferreira/Walton: Desigualidades en America Latina y el Caribe ¿Ruptura con la Historia? Banco Mundial 2004, cited in Alvaro Garcia Linera: "La Lucha por el Poder en Bolivia", in "Horizontes y Limites del Estado y el Poder". Ediciones Muella del Diablo, 2005.
Monday, December 26, 2005
A dangerous neighborhood
BY NOAM CHOMSKY
Khaleej Times (Dubai, United Arab Emirates)
December 8, 2005
HOW Venezuela Is Keeping the Home Fires Burning in Massachusetts," reads a recent full-page ad in major US newspapers from PDVSA, Venezuela’s state-owned oil company, and CITGO, its Houston-based subsidiary.
The ad describes a programme, encouraged by Venezuelan President Hugo Chavez, to sell heating oil at discount prices to low-income communities in Boston, the South Bronx and elsewhere in the United States — one of the more ironic gestures ever in the North-South dialogue. The deal developed after a group of US senators sent a letter to nine major oil companies asking them to donate a portion of their recent record profits to help poor residents cover heating bills. The only response came from CITGO.
In the United States, commentary on the deal is grudging at best, saying that Chavez, who has accused the Bush administration of trying to overthrow his government, is motivated by political ends — unlike, for example, the purely humanitarian programmes of the US Agency for International Development.
Chavez’ heating oil is one among many challenges bubbling up from Latin America for the Washington planners of grand strategy. The noisy protests during President Bush’s trip last month to the Summit of the Americas, in Argentina, amplify the dilemma.
From Venezuela to Argentina, the hemisphere is getting completely out of control, with left-centre governments all the way through. Even in Central America, still suffering the aftereffects of President Reagan’s "war on terror," the lid is barely on.
In the southern cone, the indigenous populations have become much more active and influential, particularly in Bolivia and Ecuador, both major energy producers, where they either oppose production of oil and gas or want it to be domestically controlled. Some are even calling for an "Indian nation" in South America.
Meanwhile internal economic integration is strengthening, reversing relative isolation that dates back to the Spanish conquests. Furthermore, South-South interaction is growing, with major powers (Brazil, South Africa, India) in the lead, particularly on economic issues.
Latin America as a whole is increasing trade and other relations with the European Union and China, with some setbacks, but likely expansion, especially for raw materials exporters like Brazil and Chile.
Venezuela has forged probably the closest relations with China of any Latin American country, and is planning to sell increasing amounts of oil to China as part of its effort to reduce dependence on a hostile U.S. government. Indeed, Washington’s thorniest problem in the region is Venezuela, which provides nearly 15 percent of U.S. oil imports.
Chavez, elected in 1998, displays the kind of independence that the US translates as defiance — as with Chavez’ ally Fidel Castro. In 2002, Washington embraced President Bush’s vision of democracy by supporting a military coup that very briefly overturned the Chavez government. The Bush administration had to back down, however, because of opposition to the coup in Venezuela and throughout Latin America.
Compounding Washington’s woes, Cuba-Venezuela relations are becoming very close. They practice a barter system, each relying on its strengths. Venezuela is providing low-cost oil while in return Cuba organises literacy and health programmes, and sends thousands of teachers and doctors, who, as elsewhere, work in the poorest areas, previously neglected.
Joint Cuba-Venezuela projects are also having a considerable impact in the Caribbean countries, where, under a programme called Operation Miracle, Cuban doctors are providing health care to people who had no hope of receiving it, with Venezuelan funding.
Chavez has repeatedly won monitored elections and referenda despite overwhelming and bitter media hostility. Support for the elected government has soared during the Chavez years. The veteran Latin American correspondent Hugh O’ Shaughnessy explains why in a report for Irish Times:
"In Venezuela, where an oil economy has over the decades produced a sparkling elite of superrich, a quarter of under-15s go hungry, for instance, and 60 per cent of people over 59 have no income at all. Less than a fifth of the population enjoys social security. Only now under President Chavez ... has medicine started to become something of a reality for the poverty-stricken majority in the rich but deeply divided — virtually nonfunctioning — society. Since he won power in democratic elections and began to transform the health and welfare sector which catered so badly to the mass of the population progress has been slow. But it has been perceptible ..."
Now Venezuela is joining Mercosur, South America’s leading trade bloc. Mercosur, which already includes Argentina, Brazil, Paraguay and Uruguay, presents an alternative to the so-called Free Trade Agreement of the Americas, backed by the United States.
At issue in the region, as elsewhere around the world, is alternative social and economic models. Enormous, unprecedented popular movements have developed to expand cross-border integration — going beyond economic agendas to encompass human rights, environmental concerns, cultural independence and people-to-people contacts.
These movements are ludicrously called "anti-globalisation" because they favour globalisation directed to the interests of people, not investors and financial institutions. US problems in the Americas extend north as well as south. For obvious reasons, Washington has hoped to rely more on Canada, Venezuela and other non-Middle East oil resources.
But Canada’s relations with the United States are more "strained and combative" than ever before as a result of, among other issues, Washington’s rejection of NAFTA decisions favouring Canada. As Joel Brinkley reports in The New York Times, "Partly as a result, Canada is working hard to build up its relationship with China (and) some officials are saying Canada may shift a significant portion of its trade, particularly oil, from the United States to China."
It takes real talent for the United States to alienate even Canada.
Washington’s Latin American policies are only enhancing US isolation, however. One recent example: For the 14th year in a row, the UN General Assembly voted against the US commercial embargo against Cuba. The vote on the resolution was 182 to 4: the United States, Israel, the Marshall Islands and Palau. Micronesia abstained.Eminent thinker Noam Chomsky, the author, most recently, of Imperial Ambitions: Conversations on the Post-9/11 World
Khaleej Times (Dubai, United Arab Emirates)
December 8, 2005
HOW Venezuela Is Keeping the Home Fires Burning in Massachusetts," reads a recent full-page ad in major US newspapers from PDVSA, Venezuela’s state-owned oil company, and CITGO, its Houston-based subsidiary.
The ad describes a programme, encouraged by Venezuelan President Hugo Chavez, to sell heating oil at discount prices to low-income communities in Boston, the South Bronx and elsewhere in the United States — one of the more ironic gestures ever in the North-South dialogue. The deal developed after a group of US senators sent a letter to nine major oil companies asking them to donate a portion of their recent record profits to help poor residents cover heating bills. The only response came from CITGO.
In the United States, commentary on the deal is grudging at best, saying that Chavez, who has accused the Bush administration of trying to overthrow his government, is motivated by political ends — unlike, for example, the purely humanitarian programmes of the US Agency for International Development.
Chavez’ heating oil is one among many challenges bubbling up from Latin America for the Washington planners of grand strategy. The noisy protests during President Bush’s trip last month to the Summit of the Americas, in Argentina, amplify the dilemma.
From Venezuela to Argentina, the hemisphere is getting completely out of control, with left-centre governments all the way through. Even in Central America, still suffering the aftereffects of President Reagan’s "war on terror," the lid is barely on.
In the southern cone, the indigenous populations have become much more active and influential, particularly in Bolivia and Ecuador, both major energy producers, where they either oppose production of oil and gas or want it to be domestically controlled. Some are even calling for an "Indian nation" in South America.
Meanwhile internal economic integration is strengthening, reversing relative isolation that dates back to the Spanish conquests. Furthermore, South-South interaction is growing, with major powers (Brazil, South Africa, India) in the lead, particularly on economic issues.
Latin America as a whole is increasing trade and other relations with the European Union and China, with some setbacks, but likely expansion, especially for raw materials exporters like Brazil and Chile.
Venezuela has forged probably the closest relations with China of any Latin American country, and is planning to sell increasing amounts of oil to China as part of its effort to reduce dependence on a hostile U.S. government. Indeed, Washington’s thorniest problem in the region is Venezuela, which provides nearly 15 percent of U.S. oil imports.
Chavez, elected in 1998, displays the kind of independence that the US translates as defiance — as with Chavez’ ally Fidel Castro. In 2002, Washington embraced President Bush’s vision of democracy by supporting a military coup that very briefly overturned the Chavez government. The Bush administration had to back down, however, because of opposition to the coup in Venezuela and throughout Latin America.
Compounding Washington’s woes, Cuba-Venezuela relations are becoming very close. They practice a barter system, each relying on its strengths. Venezuela is providing low-cost oil while in return Cuba organises literacy and health programmes, and sends thousands of teachers and doctors, who, as elsewhere, work in the poorest areas, previously neglected.
Joint Cuba-Venezuela projects are also having a considerable impact in the Caribbean countries, where, under a programme called Operation Miracle, Cuban doctors are providing health care to people who had no hope of receiving it, with Venezuelan funding.
Chavez has repeatedly won monitored elections and referenda despite overwhelming and bitter media hostility. Support for the elected government has soared during the Chavez years. The veteran Latin American correspondent Hugh O’ Shaughnessy explains why in a report for Irish Times:
"In Venezuela, where an oil economy has over the decades produced a sparkling elite of superrich, a quarter of under-15s go hungry, for instance, and 60 per cent of people over 59 have no income at all. Less than a fifth of the population enjoys social security. Only now under President Chavez ... has medicine started to become something of a reality for the poverty-stricken majority in the rich but deeply divided — virtually nonfunctioning — society. Since he won power in democratic elections and began to transform the health and welfare sector which catered so badly to the mass of the population progress has been slow. But it has been perceptible ..."
Now Venezuela is joining Mercosur, South America’s leading trade bloc. Mercosur, which already includes Argentina, Brazil, Paraguay and Uruguay, presents an alternative to the so-called Free Trade Agreement of the Americas, backed by the United States.
At issue in the region, as elsewhere around the world, is alternative social and economic models. Enormous, unprecedented popular movements have developed to expand cross-border integration — going beyond economic agendas to encompass human rights, environmental concerns, cultural independence and people-to-people contacts.
These movements are ludicrously called "anti-globalisation" because they favour globalisation directed to the interests of people, not investors and financial institutions. US problems in the Americas extend north as well as south. For obvious reasons, Washington has hoped to rely more on Canada, Venezuela and other non-Middle East oil resources.
But Canada’s relations with the United States are more "strained and combative" than ever before as a result of, among other issues, Washington’s rejection of NAFTA decisions favouring Canada. As Joel Brinkley reports in The New York Times, "Partly as a result, Canada is working hard to build up its relationship with China (and) some officials are saying Canada may shift a significant portion of its trade, particularly oil, from the United States to China."
It takes real talent for the United States to alienate even Canada.
Washington’s Latin American policies are only enhancing US isolation, however. One recent example: For the 14th year in a row, the UN General Assembly voted against the US commercial embargo against Cuba. The vote on the resolution was 182 to 4: the United States, Israel, the Marshall Islands and Palau. Micronesia abstained.Eminent thinker Noam Chomsky, the author, most recently, of Imperial Ambitions: Conversations on the Post-9/11 World
Latin America: Schooling Not Enough to Help the Poorest
By Daniela Estrada
December 8, 2005
SANTIAGO, Dec. 7, 2005 (IPS/GIN) -- Education alone will not solve the huge inequalities that afflict Latin America and the Caribbean, authorities and researchers warn.
Ana Luiza Machado, regional director of UNESCO (United Nations' Educational, Scientific and Cultural Organization), said the region's development model generates inequality, since it creates growth without jobs and fails to distribute wealth equitably.
Latin America has the most unequal distribution of wealth of any region in the world.
Machado was speaking at the intergovernmental meeting on the Regional Education Project for Latin America and the Caribbean (PRELAC).
About 30 ministers and deputy ministers of education gathered with UNESCO experts and educational researchers Tuesday and Wednesday in Santiago to assess the progress made on PRELAC. The educational project was approved in 2002 by representatives meeting in Havana, as a framework for achieving goals adopted at the World Forum on Education for All two years earlier in Dakar. At the global conference, the governments committed themselves, among other things, to "ensuring that by 2015 all children ... have access to and complete free and compulsory primary education of good quality."
However, socioeconomic, geographic, demographic, ethnic and gender factors continue to generate inequality.
December 8, 2005
SANTIAGO, Dec. 7, 2005 (IPS/GIN) -- Education alone will not solve the huge inequalities that afflict Latin America and the Caribbean, authorities and researchers warn.
Ana Luiza Machado, regional director of UNESCO (United Nations' Educational, Scientific and Cultural Organization), said the region's development model generates inequality, since it creates growth without jobs and fails to distribute wealth equitably.
Latin America has the most unequal distribution of wealth of any region in the world.
Machado was speaking at the intergovernmental meeting on the Regional Education Project for Latin America and the Caribbean (PRELAC).
About 30 ministers and deputy ministers of education gathered with UNESCO experts and educational researchers Tuesday and Wednesday in Santiago to assess the progress made on PRELAC. The educational project was approved in 2002 by representatives meeting in Havana, as a framework for achieving goals adopted at the World Forum on Education for All two years earlier in Dakar. At the global conference, the governments committed themselves, among other things, to "ensuring that by 2015 all children ... have access to and complete free and compulsory primary education of good quality."
However, socioeconomic, geographic, demographic, ethnic and gender factors continue to generate inequality.
Two countries, one booming, one struggling: which one followed the free-trade route?
A look at Vietnam and Mexico exposes the myth of market liberalisation
By Larry Elliott, economics editor
December 12, 2005
Guardian
Expect much gnashing of teeth in Hong Kong this week. The chances of securing a comprehensive trade deal are non-existent, with the talks now really about damage limitation and the apportionment of blame.
The development charities will say that the selfish behaviour of the developed world has condemned poor nations to further penury. Washington and Brussels will say the negotiations have been stymied by the obduracy of India and Brazil. Economists will have a field day explaining how the world is turning its back on millions of dollars' worth of extra growth, and that the poor countries will be the ones who will really suffer if the global economy lapses back into a new dark age of protectionism.
That's certainly the accepted view. An alternative argument is that the trade talks are pretty much irrelevant to development and that in as much as they do matter, developing countries may be buying a pup.
The Harvard economist Dani Rodrik is one trade sceptic. Take Mexico and Vietnam, he says. One has a long border with the richest country in the world and has had a free-trade agreement with its neighbour across the Rio Grande. It receives oodles of inward investment and sends its workers across the border in droves. It is fully plugged in to the global economy. The other was the subject of a US trade embargo until 1994 and suffered from trade restrictions for years after that. Unlike Mexico, Vietnam is not even a member of the WTO.
So which of the two has the better recent economic record? The question should be a no-brainer if all the free-trade theories are right - Mexico should be streets ahead of Vietnam. In fact, the opposite is true. Since Mexico signed the Nafta (North American Free Trade Agreement) deal with the US and Canada in 1992, its annual per capita growth rate has barely been above 1%. Vietnam has grown by around 5% a year for the past two decades. Poverty in Vietnam has come down dramatically: real wages in Mexico have fallen.
Rodrik doesn't buy the argument that the key to rapid development for poor countries is their willingness to liberalise trade. Nor, for that matter, does he think boosting aid makes much difference either. Looking around the world, he looks in vain for the success stories of three decades of neo-liberal orthodoxy: nations that have really made it after taking the advice - willingly or not - of the IMF and the World Bank.
Rather, the countries that have achieved rapid economic take-off in the past 50 years have done so as a result of policies tailored to their own domestic needs. Vietnam shows that what you do at home is far more important than access to foreign markets. There is little evidence that trade barriers are an impediment to growth for those countries following the right domestic policies.
Those policies have often been the diametric opposite of the orthodoxy. South Korea and Taiwan focused their economies on exports, but combined that outward orientation with high levels of tariffs and other forms of protection, state ownership, domestic-content requirements for industry, directed credit and limits to capital flows.
Rodrik says: "Since the late 1970s, China also followed a highly unorthodox two-track strategy, violating practically every rule in the guidebook. Conversely, countries that adhered more strictly to the orthodox structural reform agenda - most notably Latin America - have fared less well. Since the mid-1980s, virtually all Latin American countries opened up their economies, privatised their public enterprises, allowed unrestricted access for foreign capital and deregulated their economies. Yet they have grown at a fraction of the pace of the heterodox reformers, while also being buffeted more strongly by macroeconomic instability."
This is an argument taken up by Ha Joon Chang in a recent paper for the South Centre, the developing countries' intergovernmental forum. Chang argues that "there is a respectable historical case for tariff protection for industries that are not yet profitable, especially in developing countries. By contrast, free trade works well only in the fantasy theoretical world of perfect competition."
Going right back to the mid-18th century, Chang says Pitt the Elder's view was that the American colonists were not to be allowed to manufacture so much as a horseshoe nail. Adam Smith agreed. It would be better all round if the Americans concentrated on agricultural goods and left manufacturing to Britain.
Alexander Hamilton, the first US Treasury secretary, dissented from this view. In a package presented to Congress in 1791, he proposed measures to protect America's infant industries. America went with Hamilton rather than Smith. For the next century and a half, the US economy grew behind high tariff walls, with an industrial tariff that tended to be above 40% and rarely slipped below 25%. This level of support is far higher than the US is prepared to tolerate in the trade negotiations now under way.
The lesson is clear, Chang says. South Korea would still be exporting wigs made from human hair if it had liberalised its trade in line with current thinking. Those countries that did liberalise prematurely under international pressure - Senegal, for example - saw their manufacturing firms wiped out by foreign competition.
Infant industry
He draws the comparison with bringing up children. "In the same way that we protect our children until they grow up and are able to compete with adults in the labour market, developing country governments need to protect their newly emerging industries until they go through a period of learning and become able to compete with the producers from more advanced countries."
As with children, infant industry protection can go wrong. But, says Chang, "just as failures in the world of parental protection are hardly an argument against parenting itself, so cases of failures of infant industry protection do not constitute an argument against infant industry protection per se - especially when history shows that with startlingly few exceptions, successful countries in the past and in the present have used infant industry protection".
The chances of success are increased if the choice of target infant industries is realistic, protection is combined with an export strategy, the state imposes discipline on the firms receiving protection and the government is competent.
Another counter-argument is that while a modicum of protection may be necessary, most developing countries now have tariff rates much higher than those used by today's developed countries in the past. Chang says this ignores one vital point: the productivity gap between rich and poor countries today is far higher than it was in the past, so it is perfectly logical for tariffs to be higher.
For example, Britain and the Netherlands were perhaps up to four times as rich as Japan or Finland in the 19th century; today, Switzerland or the US is 50 or 60 times as rich as Ethiopia or Tanzania. Yet in Hong Kong the pressure will be on the bigger developing countries to make the big concessions on industrial tariffs, cutting them to levels below those that existed in most rich countries until the early 1970s.
History suggest that accepting the demands of Washington and Brussels would be unwise, to say the least.
By Larry Elliott, economics editor
December 12, 2005
Guardian
Expect much gnashing of teeth in Hong Kong this week. The chances of securing a comprehensive trade deal are non-existent, with the talks now really about damage limitation and the apportionment of blame.
The development charities will say that the selfish behaviour of the developed world has condemned poor nations to further penury. Washington and Brussels will say the negotiations have been stymied by the obduracy of India and Brazil. Economists will have a field day explaining how the world is turning its back on millions of dollars' worth of extra growth, and that the poor countries will be the ones who will really suffer if the global economy lapses back into a new dark age of protectionism.
That's certainly the accepted view. An alternative argument is that the trade talks are pretty much irrelevant to development and that in as much as they do matter, developing countries may be buying a pup.
The Harvard economist Dani Rodrik is one trade sceptic. Take Mexico and Vietnam, he says. One has a long border with the richest country in the world and has had a free-trade agreement with its neighbour across the Rio Grande. It receives oodles of inward investment and sends its workers across the border in droves. It is fully plugged in to the global economy. The other was the subject of a US trade embargo until 1994 and suffered from trade restrictions for years after that. Unlike Mexico, Vietnam is not even a member of the WTO.
So which of the two has the better recent economic record? The question should be a no-brainer if all the free-trade theories are right - Mexico should be streets ahead of Vietnam. In fact, the opposite is true. Since Mexico signed the Nafta (North American Free Trade Agreement) deal with the US and Canada in 1992, its annual per capita growth rate has barely been above 1%. Vietnam has grown by around 5% a year for the past two decades. Poverty in Vietnam has come down dramatically: real wages in Mexico have fallen.
Rodrik doesn't buy the argument that the key to rapid development for poor countries is their willingness to liberalise trade. Nor, for that matter, does he think boosting aid makes much difference either. Looking around the world, he looks in vain for the success stories of three decades of neo-liberal orthodoxy: nations that have really made it after taking the advice - willingly or not - of the IMF and the World Bank.
Rather, the countries that have achieved rapid economic take-off in the past 50 years have done so as a result of policies tailored to their own domestic needs. Vietnam shows that what you do at home is far more important than access to foreign markets. There is little evidence that trade barriers are an impediment to growth for those countries following the right domestic policies.
Those policies have often been the diametric opposite of the orthodoxy. South Korea and Taiwan focused their economies on exports, but combined that outward orientation with high levels of tariffs and other forms of protection, state ownership, domestic-content requirements for industry, directed credit and limits to capital flows.
Rodrik says: "Since the late 1970s, China also followed a highly unorthodox two-track strategy, violating practically every rule in the guidebook. Conversely, countries that adhered more strictly to the orthodox structural reform agenda - most notably Latin America - have fared less well. Since the mid-1980s, virtually all Latin American countries opened up their economies, privatised their public enterprises, allowed unrestricted access for foreign capital and deregulated their economies. Yet they have grown at a fraction of the pace of the heterodox reformers, while also being buffeted more strongly by macroeconomic instability."
This is an argument taken up by Ha Joon Chang in a recent paper for the South Centre, the developing countries' intergovernmental forum. Chang argues that "there is a respectable historical case for tariff protection for industries that are not yet profitable, especially in developing countries. By contrast, free trade works well only in the fantasy theoretical world of perfect competition."
Going right back to the mid-18th century, Chang says Pitt the Elder's view was that the American colonists were not to be allowed to manufacture so much as a horseshoe nail. Adam Smith agreed. It would be better all round if the Americans concentrated on agricultural goods and left manufacturing to Britain.
Alexander Hamilton, the first US Treasury secretary, dissented from this view. In a package presented to Congress in 1791, he proposed measures to protect America's infant industries. America went with Hamilton rather than Smith. For the next century and a half, the US economy grew behind high tariff walls, with an industrial tariff that tended to be above 40% and rarely slipped below 25%. This level of support is far higher than the US is prepared to tolerate in the trade negotiations now under way.
The lesson is clear, Chang says. South Korea would still be exporting wigs made from human hair if it had liberalised its trade in line with current thinking. Those countries that did liberalise prematurely under international pressure - Senegal, for example - saw their manufacturing firms wiped out by foreign competition.
Infant industry
He draws the comparison with bringing up children. "In the same way that we protect our children until they grow up and are able to compete with adults in the labour market, developing country governments need to protect their newly emerging industries until they go through a period of learning and become able to compete with the producers from more advanced countries."
As with children, infant industry protection can go wrong. But, says Chang, "just as failures in the world of parental protection are hardly an argument against parenting itself, so cases of failures of infant industry protection do not constitute an argument against infant industry protection per se - especially when history shows that with startlingly few exceptions, successful countries in the past and in the present have used infant industry protection".
The chances of success are increased if the choice of target infant industries is realistic, protection is combined with an export strategy, the state imposes discipline on the firms receiving protection and the government is competent.
Another counter-argument is that while a modicum of protection may be necessary, most developing countries now have tariff rates much higher than those used by today's developed countries in the past. Chang says this ignores one vital point: the productivity gap between rich and poor countries today is far higher than it was in the past, so it is perfectly logical for tariffs to be higher.
For example, Britain and the Netherlands were perhaps up to four times as rich as Japan or Finland in the 19th century; today, Switzerland or the US is 50 or 60 times as rich as Ethiopia or Tanzania. Yet in Hong Kong the pressure will be on the bigger developing countries to make the big concessions on industrial tariffs, cutting them to levels below those that existed in most rich countries until the early 1970s.
History suggest that accepting the demands of Washington and Brussels would be unwise, to say the least.
The Usual Suspects in Peru's Presidential Race
By Ángel Páez
LIMA, Dec 26 (IPS) - A mantle of corruption and impunity has begun to cast a shadow over the campaign for Peru's April presidential elections, despite the fact that the candidates have not even been officially registered yet.
The presidential hopeful of the right-wing National Unity coalition, Lourdes Flores, who is the front-runner in the polls, presented businessman Arturo Woodman as her vice presidential running mate.
Woodman was not only closely involved with the corrupt regime of Alberto Fujimori (1990-2000), but is also a close associate of banker Dionisio Romero, who faced charges for trafficking of influences.
Two congressional commissions that investigated economic and financial crimes committed during the government of Fujimori found that Woodman was involved in four cases of corruption.
In addition, it was Woodman who personally brought Romero to the offices of then-security chief Vladimiro Montesinos, considered the power behind the throne during the Fujimori administrations.
Both Fujimori and Montesinos are in prison today - the former in Chile, where he is awaiting extradition to Peru on charges of crimes against humanity and corruption, and the latter in Peru, where he is being tried for a long list of crimes.
Montesinos filmed hundreds of videos in his office, showing how he bribed politicians, media owners and others. One of the many video recordings that triggered the scandal which brought down the Fujimori regime showed Romero asking Montesinos to intervene in a legal case involving one of the clients at his bank.
Although Woodman admitted that he took Romero to Montesinos' offices, he claimed that the two men "never spoke of business or politics."
However, on a video showing one of their meetings, Romero and Montesinos can be heard commenting on the need to lower taxes on wheat imports, another of the areas in which Romero has a business interest.
The banker himself also testified before a congressional investigatory commission that he and Montesinos touched on political and business issues.
Despite everything, Flores decided to put Woodman on her ticket.
"Someone who has had such close ties to Montesinos should abstain from participating in politics, let alone run for vice president, no matter what party he belongs to," Ronald Gamarra, a former anti-corruption prosecutor and an investigator at the Legal Defence Institute, told IPS.
But the allegations against Woodman are not the only ones that have tarnished the campaign for the elections in which President Alejandro Toledo's successor will be elected.
Questions have also been raised about the running mate of former president Alan García (1985-1990), who plans to seek a second term representing the social democratic Peruvian Aprista Party.
García announced that he would put retired admiral Luis Giampietri Rojas, a veteran naval officer who specialised in commando and intelligence operations, on his ticket.
Giampietri is a self-declared enemy of human rights organisations and a fierce critic of the Truth and Reconciliation Commission, which investigated the "dirty war" waged by the security forces against the insurgent Shining Path and Tupac Amaru Revolutionary Movement (MRTA) between 1980 and 2000.
The former president has presented Giampietri as an expert in security with ample combat experience, while highlighting his democratic and personal credentials.
But he neglected to mention that the retired naval officer was one of the two officers who ordered the June 1986 crackdown on a riot staged by inmates jailed for "terrorism" in the prison on El Frontón island, during the García administration. Some 300 prisoners were killed in the bloody incident.
The Truth Commission found that many of the prisoners were summarily executed after they surrendered, although the deaths were reported as having occurred during a firefight. Several of the prisoners who were killed were later found innocent of the charges on which they had been jailed.
García is facing criminal charges in that case, in which Giampietri is a witness.
But despite the abundant well-documented evidence and testimony, Giampietri denies that the prisoners were the victims of extrajudicial executions, and claims that "what happened in Frontón was not a massacre, but combat."
"What happened was that some of my men were killed. We are facing unfair penal proceedings, but we will come out of it just fine," he has stated.
Nor was the retired officer completely unconnected with the Fujimori regime. His name was on the parliamentary slate presented by Juan Carlos Hurtado, who ran for mayor of Lima for the Vamos Vecino movement, a Fujimori front.
Hurtado, whose campaign was financed by Montesinos, has been a fugitive from justice since a video recording was divulged showing the former spy chief handing Hurtado a briefcase full of cash.
But the problem is not only incidents from the past that raise doubts concerning Woodman and Giampietri. The real issue, said Gamarra, is not only that they have not repented, but that they justify their past actions.
In spite of his well-known relations with Fujimori, Montesinos and Romero, Woodman is an outspoken critic of the special anticorruption bodies set up to investigate and prosecute past offences.
"The citizens do not want to see people who are implicated in corruption and who have ties to the 'Fuji-Montesinos mafia' in the political arena, or in public posts," said Gamarra.
And in the case of Giampietri, analysts point out that he has been a staunch opponent of the removal of the military courts, which under Fujimori violated the most basic rights of civilians accused of belonging to insurgent groups.
Fujimori and Montesinos allegedly used military judges to persecute and punish their foes, and to save their associates and collaborators from the ordinary courts. Many members of the armed forces accused of human rights abuses or involvement in the drug trade were protected by the military courts.
There are fears that if Giampietri becomes vice president, he will attempt to bring to a close the trials faced by military personnel accused of committing crimes against humanity during the dirty war. The retired officer has stated that he considers the trials "an act of vengeance against those who risked their lives to pacify the country."
"The naming of Giampietri as Alan García's vice presidential candidate is in keeping with the Peruvian Aprista Party's position in favour of impunity and against investigations of human rights violations," said Gloria Cano, with the APRODEH human rights association.
"Giampietri has not only been investigated for the El Frontón massacre, but has always openly defended all of the members of the armed forces facing charges or investigations for crimes against humanity," the activist told IPS.
"As a candidate on García's slate, Giampietri's position as a witness in the trial against García is compromised," she said.
"It is a fact that García and Giampietri have agreed that everything should be left in complete impunity," Cano maintained.
Opinion polls show Flores in the lead for the April elections, followed by indigenous retired army colonel Ollanta Humala, who has a slight advantage over García. (END/2005)
LIMA, Dec 26 (IPS) - A mantle of corruption and impunity has begun to cast a shadow over the campaign for Peru's April presidential elections, despite the fact that the candidates have not even been officially registered yet.
The presidential hopeful of the right-wing National Unity coalition, Lourdes Flores, who is the front-runner in the polls, presented businessman Arturo Woodman as her vice presidential running mate.
Woodman was not only closely involved with the corrupt regime of Alberto Fujimori (1990-2000), but is also a close associate of banker Dionisio Romero, who faced charges for trafficking of influences.
Two congressional commissions that investigated economic and financial crimes committed during the government of Fujimori found that Woodman was involved in four cases of corruption.
In addition, it was Woodman who personally brought Romero to the offices of then-security chief Vladimiro Montesinos, considered the power behind the throne during the Fujimori administrations.
Both Fujimori and Montesinos are in prison today - the former in Chile, where he is awaiting extradition to Peru on charges of crimes against humanity and corruption, and the latter in Peru, where he is being tried for a long list of crimes.
Montesinos filmed hundreds of videos in his office, showing how he bribed politicians, media owners and others. One of the many video recordings that triggered the scandal which brought down the Fujimori regime showed Romero asking Montesinos to intervene in a legal case involving one of the clients at his bank.
Although Woodman admitted that he took Romero to Montesinos' offices, he claimed that the two men "never spoke of business or politics."
However, on a video showing one of their meetings, Romero and Montesinos can be heard commenting on the need to lower taxes on wheat imports, another of the areas in which Romero has a business interest.
The banker himself also testified before a congressional investigatory commission that he and Montesinos touched on political and business issues.
Despite everything, Flores decided to put Woodman on her ticket.
"Someone who has had such close ties to Montesinos should abstain from participating in politics, let alone run for vice president, no matter what party he belongs to," Ronald Gamarra, a former anti-corruption prosecutor and an investigator at the Legal Defence Institute, told IPS.
But the allegations against Woodman are not the only ones that have tarnished the campaign for the elections in which President Alejandro Toledo's successor will be elected.
Questions have also been raised about the running mate of former president Alan García (1985-1990), who plans to seek a second term representing the social democratic Peruvian Aprista Party.
García announced that he would put retired admiral Luis Giampietri Rojas, a veteran naval officer who specialised in commando and intelligence operations, on his ticket.
Giampietri is a self-declared enemy of human rights organisations and a fierce critic of the Truth and Reconciliation Commission, which investigated the "dirty war" waged by the security forces against the insurgent Shining Path and Tupac Amaru Revolutionary Movement (MRTA) between 1980 and 2000.
The former president has presented Giampietri as an expert in security with ample combat experience, while highlighting his democratic and personal credentials.
But he neglected to mention that the retired naval officer was one of the two officers who ordered the June 1986 crackdown on a riot staged by inmates jailed for "terrorism" in the prison on El Frontón island, during the García administration. Some 300 prisoners were killed in the bloody incident.
The Truth Commission found that many of the prisoners were summarily executed after they surrendered, although the deaths were reported as having occurred during a firefight. Several of the prisoners who were killed were later found innocent of the charges on which they had been jailed.
García is facing criminal charges in that case, in which Giampietri is a witness.
But despite the abundant well-documented evidence and testimony, Giampietri denies that the prisoners were the victims of extrajudicial executions, and claims that "what happened in Frontón was not a massacre, but combat."
"What happened was that some of my men were killed. We are facing unfair penal proceedings, but we will come out of it just fine," he has stated.
Nor was the retired officer completely unconnected with the Fujimori regime. His name was on the parliamentary slate presented by Juan Carlos Hurtado, who ran for mayor of Lima for the Vamos Vecino movement, a Fujimori front.
Hurtado, whose campaign was financed by Montesinos, has been a fugitive from justice since a video recording was divulged showing the former spy chief handing Hurtado a briefcase full of cash.
But the problem is not only incidents from the past that raise doubts concerning Woodman and Giampietri. The real issue, said Gamarra, is not only that they have not repented, but that they justify their past actions.
In spite of his well-known relations with Fujimori, Montesinos and Romero, Woodman is an outspoken critic of the special anticorruption bodies set up to investigate and prosecute past offences.
"The citizens do not want to see people who are implicated in corruption and who have ties to the 'Fuji-Montesinos mafia' in the political arena, or in public posts," said Gamarra.
And in the case of Giampietri, analysts point out that he has been a staunch opponent of the removal of the military courts, which under Fujimori violated the most basic rights of civilians accused of belonging to insurgent groups.
Fujimori and Montesinos allegedly used military judges to persecute and punish their foes, and to save their associates and collaborators from the ordinary courts. Many members of the armed forces accused of human rights abuses or involvement in the drug trade were protected by the military courts.
There are fears that if Giampietri becomes vice president, he will attempt to bring to a close the trials faced by military personnel accused of committing crimes against humanity during the dirty war. The retired officer has stated that he considers the trials "an act of vengeance against those who risked their lives to pacify the country."
"The naming of Giampietri as Alan García's vice presidential candidate is in keeping with the Peruvian Aprista Party's position in favour of impunity and against investigations of human rights violations," said Gloria Cano, with the APRODEH human rights association.
"Giampietri has not only been investigated for the El Frontón massacre, but has always openly defended all of the members of the armed forces facing charges or investigations for crimes against humanity," the activist told IPS.
"As a candidate on García's slate, Giampietri's position as a witness in the trial against García is compromised," she said.
"It is a fact that García and Giampietri have agreed that everything should be left in complete impunity," Cano maintained.
Opinion polls show Flores in the lead for the April elections, followed by indigenous retired army colonel Ollanta Humala, who has a slight advantage over García. (END/2005)
Sunday, December 25, 2005
Brazil: Cutting the Wire
Witnessing a land occupation
BY Adam Raney and Chad Heeter
Frontline
December 13, 2005
Half of Brazil's farmland belongs to just 4 percent of the population -- a glaring inequality in a nation known for its stark division between rich and poor. Brazil has one of the biggest GDPs in the world, larger than the combined economies of all the other countries in South America. But nearly a quarter of Brazil's 186 million people live below the poverty line, many of them in notorious urban slums, or favelas. As author John Krich once caustically asked, "Why is this country dancing?"
This week on Rough Cut, we travel to a dusty patch of rural Brazil where FRONTLINE/World Fellows Adam Raney and Chad Heeter witness a land occupation by a thousand poor people and activists who take over a strategic corner of a ranch that is about an eight-hour drive west of Sao Paulo. As you'll see in their video, "Cutting the Wire," it is an invasion conducted in the middle of the night, with stealth and precision.
The Negrao family has owned the land -- a vast expanse of 17,000 acres -- for three generations. They are, understandably, furious. "If somebody invades your house, are you going to let them have it?" an angry Marcelo Negrao asks Raney and Heeter. "I want the state to guarantee my rights, and if they don't, I will."
But those occupying the land -- including a couple living with HIV and other refugees from Sao Paulo's desperate slums -- claim that the Negraos are absentee landlords whose ancestors took possession in an illegal 19th-century land grab.
The land occupation was organized by the Movimento dos Trabalhadores Rurais Sem Terra, or MST, a national movement with more than 1.5 million members. The MST acts like Robin Hood, seizing what they consider to be "unproductive" land and redistributing it to the landless poor. They rely on the Brazilian constitution, which states that all land must be productive. Absentee landlords can be compelled to forfeit idle land. Since its beginnings more than 20 years ago, the MST has pushed the government to redistribute more than 20 million acres to nearly 400,000 families.
One MST leader, Padre Renee, tells Raney, "This isn't just about agrarian reform. It's bigger than a piece of land to work on. It's about changing Brazil, creating a new society, just, equal and brotherly."
Large estate owners, fazendeiros, don't see it that way and regard the MST and their machete-carrying adherents as a dangerous Marxist organization bent on stealing their land. Many owners employ private security forces to intimidate MST organizers and repel their land invasions. Sometimes the clashes turn violent. Nearly 1,500 landless activists have died in confrontations over the past two decades.
The election in 2002 of Brazil's first working-class president, Luiz Inacio Lula da Silva, was supposed to be a turning point for the MST, but Lula has disappointed the more radical advocates of land reform. In May 2005, some 15,000 MST activists marched on the capital to express their displeasure.
Raney and Heeter capture the spirit of what is happening within a movement inspired by Catholic "liberation theology" and Che Guevara, a movement that exists in a country that produces cars, airplanes and software and that exports more sugar, coffee and beef than any other nation worldwide -- but that can't find jobs or farmland for millions of its citizens.
BY Adam Raney and Chad Heeter
Frontline
December 13, 2005
Half of Brazil's farmland belongs to just 4 percent of the population -- a glaring inequality in a nation known for its stark division between rich and poor. Brazil has one of the biggest GDPs in the world, larger than the combined economies of all the other countries in South America. But nearly a quarter of Brazil's 186 million people live below the poverty line, many of them in notorious urban slums, or favelas. As author John Krich once caustically asked, "Why is this country dancing?"
This week on Rough Cut, we travel to a dusty patch of rural Brazil where FRONTLINE/World Fellows Adam Raney and Chad Heeter witness a land occupation by a thousand poor people and activists who take over a strategic corner of a ranch that is about an eight-hour drive west of Sao Paulo. As you'll see in their video, "Cutting the Wire," it is an invasion conducted in the middle of the night, with stealth and precision.
The Negrao family has owned the land -- a vast expanse of 17,000 acres -- for three generations. They are, understandably, furious. "If somebody invades your house, are you going to let them have it?" an angry Marcelo Negrao asks Raney and Heeter. "I want the state to guarantee my rights, and if they don't, I will."
But those occupying the land -- including a couple living with HIV and other refugees from Sao Paulo's desperate slums -- claim that the Negraos are absentee landlords whose ancestors took possession in an illegal 19th-century land grab.
The land occupation was organized by the Movimento dos Trabalhadores Rurais Sem Terra, or MST, a national movement with more than 1.5 million members. The MST acts like Robin Hood, seizing what they consider to be "unproductive" land and redistributing it to the landless poor. They rely on the Brazilian constitution, which states that all land must be productive. Absentee landlords can be compelled to forfeit idle land. Since its beginnings more than 20 years ago, the MST has pushed the government to redistribute more than 20 million acres to nearly 400,000 families.
One MST leader, Padre Renee, tells Raney, "This isn't just about agrarian reform. It's bigger than a piece of land to work on. It's about changing Brazil, creating a new society, just, equal and brotherly."
Large estate owners, fazendeiros, don't see it that way and regard the MST and their machete-carrying adherents as a dangerous Marxist organization bent on stealing their land. Many owners employ private security forces to intimidate MST organizers and repel their land invasions. Sometimes the clashes turn violent. Nearly 1,500 landless activists have died in confrontations over the past two decades.
The election in 2002 of Brazil's first working-class president, Luiz Inacio Lula da Silva, was supposed to be a turning point for the MST, but Lula has disappointed the more radical advocates of land reform. In May 2005, some 15,000 MST activists marched on the capital to express their displeasure.
Raney and Heeter capture the spirit of what is happening within a movement inspired by Catholic "liberation theology" and Che Guevara, a movement that exists in a country that produces cars, airplanes and software and that exports more sugar, coffee and beef than any other nation worldwide -- but that can't find jobs or farmland for millions of its citizens.
PERU: Pro-Indigenous Retired Colonel Sees Meteoric Rise in the Polls
By Ángel Páez
LIMA, Dec 13 (IPS) - Retired army colonel Ollanta Humala has experienced an unexpected surge in the polls for Peru's April 2006 elections. He now has a 22 percent rating, putting him just three points behind the current front-runner, right-wing candidate Lourdes Flores Nano, with 25 percent.
Humala, who is still in the process of registering his new party and his candidacy, started out with a mere five percent voter intention rating, and within the past four weeks rose from 11 to 22 percent in the polls.
Taking a radical stance against Peru's traditional political parties and politicians, who he blames for all of the country's ills, from corruption to extreme poverty, Humala reflects the disillusionment of Peruvians with the government of President Alejandro Toledo and its predecessors.
Ollanta - which means "the all-observing warrior" in Quechua - is not a leftist. He is an outspoken anti-United States nationalist. And while he is not a socialist, he talks about nationalising the country's "strategic enterprises".
Although he has mestizo (mixed-race) features and was born into a well-off middle-class family in Lima, he puts a strong emphasis on his Andean indigenous roots, and is especially popular among the rural poor.
His father Isaac Humala, a labour lawyer, is a former communist leader who served as the model for a colourful character in internationally renowned Peruvian novelist Mario Vargas Llosa's novel "Conversation in the Cathedral".
Isaac Humala was Vargas Llosa's instructor of Marxism-Leninism when the writer - now a conservative - formed part of a communist cell in the university.
Convinced that only the descendants of the Incas can pull Peruvians out of their current plight of poverty and discrimination, Isaac gave Quechua names to five of his eight children: Pachacutec, Ima Sumac, Cusicollur, Antauro and Ollanta.
Isaac is also the creator of Peru's "ethno-nationalist" movement, which he named "ethnocacerism" after General Andrés Avelino Cáceres, who refused to accept Peru's surrender in the War of the Pacific (1879-1883) and resisted the Chilean occupation forces with a small band of indigenous guerrillas in the Andes mountains.
Ethnocacerism is a form of extreme nationalism rooted in the vindication of the indigenous roots of the majority of Peru's population. It is based on the view that only the country's Andean indigenous peoples will be capable of freeing Peruvians from the system of exploitation put in place by the Spanish colonial power.
With the dream that one of his sons might turn out to be a new Cáceres and head up an indigenous revolution to free the millions of Peruvians impoverished by the "white elite", Isaac enrolled his sons Antauro and Ollanta in the military school in Chorrillos. After they graduated, they organised meetings in the barracks to spread the word of "ethnocacerism" among their fellow officers.
As a result of what were seen as "conspiratorial" activities, Major Antauro Humala was discharged from the army in January 1998. But his brother Ollanta continued to spread his father's thinking.
Early in the morning of Oct. 29, 2000, Lieutenant-Colonel Ollanta Humala, leading 69 soldiers and accompanied by a group of reservists headed by his brother Antauro, seized a copper mine in the southern town of Toquepala and demanded the resignation of then-president Alberto Fujimori and the arrest of his security chief Vladimiro Montesinos.
On the day of the uprising, Montesinos fled the country by yacht to Costa Rica, and from there to Caracas, Venezuela.
The army did not make much of an effort to capture the Humala brothers, who in November turned themselves in, once caretaker president Valentín Paniagua was in office.
They were later amnestied by Paniagua.
The Humala brothers' critics say the uprising was mounted as a "smokescreen" to facilitate Montesinos' escape, and that they only staged the revolt once the government of Fujimori (1990-2000) was on the verge of collapse and represented no danger. The Humala family roundly rejects such allegations.
Today, both Fujimori and Montesinos are in prison - the former in Chile, where he is awaiting extradition to Peru on charges of crimes against humanity and corruption, and the latter in Peru, where he is being tried for a long list of crimes.
After Toledo succeeded Paniagua in 2001, Antauro Humala founded the Ethnocacerist Party of Peru, while Ollanta was reinstated to the army with the rank of colonel. Toledo gave him the post of military attaché at the Peruvian Embassy in France.
But due to his outspoken criticism of the government and the army brass, Ollanta was transferred from Paris to South Korea in 2004, where he was forced into retirement. In early January, while he was still in Asia, he found out that his brother Antauro and a group of "ethnocacerist" reservists had occupied a police station in the Andean town of Andahuaylas and taken around a dozen police officers hostage, to demand that Toledo step down and call early elections.
Ollanta at first told the press that he understood and supported his brother. But after Antauro's men killed four of the police officers the next day, he clarified that he did not support such methods.
Antauro is in prison awaiting trial, and Ollanta has made some efforts to distance himself from his brother, although the official newspaper of Antauro's Ethnocacerist Party of Peru is still called Ollanta.
In March, Ollanta began to organise his own party, the Peruvian Nationalist Party (PNP), and in April he began to take the first steps in his bid for the presidency.
Isaac, the family patriarch, told the press that Antauro and Ollanta shared the same ideology and only differed with respect to their methods.
It was Ollanta himself who began the paperwork for registering his brother's Ethnocacerist Party at ONPE, the office responsible for organising elections in Peru.
He is also registering his own party.
But his ideological affinity and ties with his brother Antauro have not stood in the way of his steady rise in the polls.
Analysts see the growth of his popularity as the latest expression of a common phenomenon in Peruvian politics. In 1990, Fujimori presented himself as the anti-establishment candidate, just as Toledo himself did 10 years later and Humala is doing today.
In the view of former interior minister Fernando Rospigliosi, a researcher at the Institute of Peruvian Studies, the retired colonel's appearance on the Peruvian political scene indicates two things: "On one hand, a deep rejection of politicians, and the way of doing politics in our country, by a large part of the population, and on the other, the scant importance that people put on democracy, their failure to heed the moral qualifications and values of people like Ollanta Humala."
In Rospigliosi's view, if Humala "wins the elections, he will put an end to democracy." He likened the presidential contender to Venezuela's controversial leftist leader, President Hugo Chávez, who also spent time in prison after leading an armed revolt as a lieutenant-colonel.
Humala has stated that he admires Chávez and has traveled to Caracas to meet with leaders from his government.
Carlos Tapia, with the Centre for Promotion and Development of the Population, a non-governmental development organisation, said Humala "channels the resentment and rage of marginalised sectors of scoiety, who believe that politicians personally and collectively benefit from democracy."
"If Humala is doing well in the polls it is because of the widespread discontent with the politicians and their parties," said Tapia. "And it is the dishonesty of the Peruvian political class that has created that sentiment."
Analyst Eduardo Toche at the Centre for the Study and Promotion of Development believes that when Humala reveals his true objectives, his popularity will begin to decline.
"I believe that on some points, Humala reflects fascist ultra-rightwing positions, which casts doubt on what his real aims are," said Toche.
"Humala has not understood that participating in accordance with the rules of the system is not the same as acting outside of the system. It remains to be seen how skillful he is working on the inside," he said.
With an electorate that has shown itself in the past to be highly unpredictable, anything can happen in the four months to go to the Apr. 9, 2006 elections.
Less than four weeks before the1990 elections, Vargas Llosa was slated to win. But outsider Fujimori suddenly surged in the polls and forced the writer into a runoff, which Fujimori ended up winning.
Fernando Tuesta, a former director of ONPE, the electoral authority, and a sociologist by training said Humala's popularity represents a mood rather than a reliable reflection of a voting tendency.
"I don't believe Humala can really be considered a threat, because his positions are ambivalent and not even openly anti-system. We will have to wait and see what happens," he said. (END/2005)
LIMA, Dec 13 (IPS) - Retired army colonel Ollanta Humala has experienced an unexpected surge in the polls for Peru's April 2006 elections. He now has a 22 percent rating, putting him just three points behind the current front-runner, right-wing candidate Lourdes Flores Nano, with 25 percent.
Humala, who is still in the process of registering his new party and his candidacy, started out with a mere five percent voter intention rating, and within the past four weeks rose from 11 to 22 percent in the polls.
Taking a radical stance against Peru's traditional political parties and politicians, who he blames for all of the country's ills, from corruption to extreme poverty, Humala reflects the disillusionment of Peruvians with the government of President Alejandro Toledo and its predecessors.
Ollanta - which means "the all-observing warrior" in Quechua - is not a leftist. He is an outspoken anti-United States nationalist. And while he is not a socialist, he talks about nationalising the country's "strategic enterprises".
Although he has mestizo (mixed-race) features and was born into a well-off middle-class family in Lima, he puts a strong emphasis on his Andean indigenous roots, and is especially popular among the rural poor.
His father Isaac Humala, a labour lawyer, is a former communist leader who served as the model for a colourful character in internationally renowned Peruvian novelist Mario Vargas Llosa's novel "Conversation in the Cathedral".
Isaac Humala was Vargas Llosa's instructor of Marxism-Leninism when the writer - now a conservative - formed part of a communist cell in the university.
Convinced that only the descendants of the Incas can pull Peruvians out of their current plight of poverty and discrimination, Isaac gave Quechua names to five of his eight children: Pachacutec, Ima Sumac, Cusicollur, Antauro and Ollanta.
Isaac is also the creator of Peru's "ethno-nationalist" movement, which he named "ethnocacerism" after General Andrés Avelino Cáceres, who refused to accept Peru's surrender in the War of the Pacific (1879-1883) and resisted the Chilean occupation forces with a small band of indigenous guerrillas in the Andes mountains.
Ethnocacerism is a form of extreme nationalism rooted in the vindication of the indigenous roots of the majority of Peru's population. It is based on the view that only the country's Andean indigenous peoples will be capable of freeing Peruvians from the system of exploitation put in place by the Spanish colonial power.
With the dream that one of his sons might turn out to be a new Cáceres and head up an indigenous revolution to free the millions of Peruvians impoverished by the "white elite", Isaac enrolled his sons Antauro and Ollanta in the military school in Chorrillos. After they graduated, they organised meetings in the barracks to spread the word of "ethnocacerism" among their fellow officers.
As a result of what were seen as "conspiratorial" activities, Major Antauro Humala was discharged from the army in January 1998. But his brother Ollanta continued to spread his father's thinking.
Early in the morning of Oct. 29, 2000, Lieutenant-Colonel Ollanta Humala, leading 69 soldiers and accompanied by a group of reservists headed by his brother Antauro, seized a copper mine in the southern town of Toquepala and demanded the resignation of then-president Alberto Fujimori and the arrest of his security chief Vladimiro Montesinos.
On the day of the uprising, Montesinos fled the country by yacht to Costa Rica, and from there to Caracas, Venezuela.
The army did not make much of an effort to capture the Humala brothers, who in November turned themselves in, once caretaker president Valentín Paniagua was in office.
They were later amnestied by Paniagua.
The Humala brothers' critics say the uprising was mounted as a "smokescreen" to facilitate Montesinos' escape, and that they only staged the revolt once the government of Fujimori (1990-2000) was on the verge of collapse and represented no danger. The Humala family roundly rejects such allegations.
Today, both Fujimori and Montesinos are in prison - the former in Chile, where he is awaiting extradition to Peru on charges of crimes against humanity and corruption, and the latter in Peru, where he is being tried for a long list of crimes.
After Toledo succeeded Paniagua in 2001, Antauro Humala founded the Ethnocacerist Party of Peru, while Ollanta was reinstated to the army with the rank of colonel. Toledo gave him the post of military attaché at the Peruvian Embassy in France.
But due to his outspoken criticism of the government and the army brass, Ollanta was transferred from Paris to South Korea in 2004, where he was forced into retirement. In early January, while he was still in Asia, he found out that his brother Antauro and a group of "ethnocacerist" reservists had occupied a police station in the Andean town of Andahuaylas and taken around a dozen police officers hostage, to demand that Toledo step down and call early elections.
Ollanta at first told the press that he understood and supported his brother. But after Antauro's men killed four of the police officers the next day, he clarified that he did not support such methods.
Antauro is in prison awaiting trial, and Ollanta has made some efforts to distance himself from his brother, although the official newspaper of Antauro's Ethnocacerist Party of Peru is still called Ollanta.
In March, Ollanta began to organise his own party, the Peruvian Nationalist Party (PNP), and in April he began to take the first steps in his bid for the presidency.
Isaac, the family patriarch, told the press that Antauro and Ollanta shared the same ideology and only differed with respect to their methods.
It was Ollanta himself who began the paperwork for registering his brother's Ethnocacerist Party at ONPE, the office responsible for organising elections in Peru.
He is also registering his own party.
But his ideological affinity and ties with his brother Antauro have not stood in the way of his steady rise in the polls.
Analysts see the growth of his popularity as the latest expression of a common phenomenon in Peruvian politics. In 1990, Fujimori presented himself as the anti-establishment candidate, just as Toledo himself did 10 years later and Humala is doing today.
In the view of former interior minister Fernando Rospigliosi, a researcher at the Institute of Peruvian Studies, the retired colonel's appearance on the Peruvian political scene indicates two things: "On one hand, a deep rejection of politicians, and the way of doing politics in our country, by a large part of the population, and on the other, the scant importance that people put on democracy, their failure to heed the moral qualifications and values of people like Ollanta Humala."
In Rospigliosi's view, if Humala "wins the elections, he will put an end to democracy." He likened the presidential contender to Venezuela's controversial leftist leader, President Hugo Chávez, who also spent time in prison after leading an armed revolt as a lieutenant-colonel.
Humala has stated that he admires Chávez and has traveled to Caracas to meet with leaders from his government.
Carlos Tapia, with the Centre for Promotion and Development of the Population, a non-governmental development organisation, said Humala "channels the resentment and rage of marginalised sectors of scoiety, who believe that politicians personally and collectively benefit from democracy."
"If Humala is doing well in the polls it is because of the widespread discontent with the politicians and their parties," said Tapia. "And it is the dishonesty of the Peruvian political class that has created that sentiment."
Analyst Eduardo Toche at the Centre for the Study and Promotion of Development believes that when Humala reveals his true objectives, his popularity will begin to decline.
"I believe that on some points, Humala reflects fascist ultra-rightwing positions, which casts doubt on what his real aims are," said Toche.
"Humala has not understood that participating in accordance with the rules of the system is not the same as acting outside of the system. It remains to be seen how skillful he is working on the inside," he said.
With an electorate that has shown itself in the past to be highly unpredictable, anything can happen in the four months to go to the Apr. 9, 2006 elections.
Less than four weeks before the1990 elections, Vargas Llosa was slated to win. But outsider Fujimori suddenly surged in the polls and forced the writer into a runoff, which Fujimori ended up winning.
Fernando Tuesta, a former director of ONPE, the electoral authority, and a sociologist by training said Humala's popularity represents a mood rather than a reliable reflection of a voting tendency.
"I don't believe Humala can really be considered a threat, because his positions are ambivalent and not even openly anti-system. We will have to wait and see what happens," he said. (END/2005)
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