A new pink wave?

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By Wagner Iglecias*

Subordinately incorporated into the nascent capitalist economy at the beginning of the 300th century, Latin America experienced, until the beginning of the XNUMXth century, a long cycle of integration into the world economy. In the first XNUMX years of its existence as a colony, obviously. And then, during the XNUMXth century, still as a continent primarily oriented towards the exterior, with its newly independent nations, competing among themselves for privileged access to the European and US markets.

only from debacle of the liberal model, symbolized by the crash of the New York Stock Exchange, in 1929, is that these countries had to adopt another model of development, marked by the inducing role of the State in the economy. Some even managed to rise to prominent positions in the world division of labor, with the incorporation and development of important and varied industry segments, such as Argentina, Brazil and Mexico. Others, such as Chile, Colombia, Peru and Venezuela, also had some degree of industrialization, although less diversified. The model also contemplated some social mobility and the creation of middle-class sectors, with the structuring of domestic consumer markets in unprecedented proportions in Latin American history.

National developmentalism and import substitution industrialization, as is well known, entered a crisis in Latin America from the second half of the 1970s onwards, due to a series of factors. Among the main ones were the two oil crises, with their disruptive effect on dependent economies, the rise in interest rates by the Federal Reserve in the early 1980s and the abrupt end of liquidity in the international financial market, making the resources with which these countries financed state investments in infrastructure. Add to this the Third Industrial Revolution, with the development of microelectronics, robotics, biotechnology and the technological leap that this represented, further distancing the region from developed countries in the context of the global structure of capitalism.

Since the end of the 1970s, Chile and Argentina had already been converted, by the dictatorships of Pinochet and Videla, into the first laboratories of the neoliberal formulas spread from the University of Chicago. but it was the default of the external debt of countries such as Mexico and Brazil, in the early 1980s (accompanied by the bankruptcy of Venezuela, and even of Argentina and Chile), which definitively opened the doors of the continent to neoliberalism. From that moment on, the IMF began to pilot, in practice, the economic management of several nations in the region, restructuring their external debts through a series of harsh counterparts, such as fiscal tightening, trade liberalization, privatization of state-owned companies and deregulation. economies in order to attract foreign investment.

Although countries like Brazil implemented heterodox economic packages until the beginning of the 1990s, between the beginning of the 1980s and the turn of the XNUMXth century, the neoliberal wave swept the entire continent, with the exception of Cuba, producing in some cases stability. monetary, yes, but at a very high social cost, with the increase in poverty and inequality, chronic and secular problems in the region.

The most recent events in Latin American history are fresh in our memory. Due to a series of factors, ranging from the economic and social crisis aggravated by neoliberalism to the US geopolitical turn towards the Middle East from the so-called “War on Terror”, Latin America has experienced in the last two decades an unprecedented fact in its history. : the successive arrival of a series of left-wing political parties to power.

The first was Hugo Chávez, elected president of Venezuela in 1998. He was followed by the triumphs of Lula (2002) in Brazil and Néstor Kirchner (2002) in Argentina. Following Tabaré Vasquez (2005) in Uruguay, Evo Morales (2006) in Bolivia, Daniel Ortega (2006) in Nicaragua, Rafael Correa (2007) in Ecuador and Maurício Funes (2009) in El Salvador. All elected wielding the flag of rescuing the social debt aggravated in the two decades of neoliberal economy, as well as national sovereignty and regional integration. Their respective political projects were renewed through re-elections or the election of supporters, as happened in Uruguay, Venezuela, Brazil and Argentina.

One of the main economic support pillars of the so-called “pink wave” was the growth of the Chinese economy in the period. The so-called “commodity boom” benefited all of Latin America, and more markedly the progressive governments, which reverted a significant portion of the growth of their economies to a significant expansion of social policies. The high popularity ratings resulting from those measures ensured a long political cycle for political forces such as the PT in Brazil, the PSUV in Venezuela and the MAS in Bolivia.

More recently, the right has regained ground in the region, with the election of Mauricio Macri in 2015 in Argentina and the impeachment of Dilma Rousseff in 2016 in Brazil. In 2012, Fernando Lugo had already suffered the same process in Paraguay, and in the same 2015 in which Macri arrived at the Casa Rosada, the right won a majority in the election for the National Assembly of Venezuela. Conservative sectors and markets celebrated, at that moment, what would be the beginning of the end of the Latin American progressive wave.

But signs of reaction from the Latin American left also emerged in the same period, in countries even unlikely to do so. In 2016 Veronika Mendoza, from the Frente Ampla, almost went to the second round of the presidential election in Peru. And in 2018, the year the neoliberal Sebatian Piñera returned to the Palacio de la Moneda in Chile, former Bogotá mayor Gustavo Petro reached the second round against rightist Ivan Duque in Colombia leading a leftist coalition.

The election of Andrés Manuel López Obrador, in the same year, 2018, broke a long cycle of conservative governments in Mexico. AMLO has, in the view of its left-wing critics, been an excessively moderate government. However, he deals with the arduous task of governing amid the heavy legacy of decades of neoliberal policies, applied both by the very traditional PRI and by the PAN, the two largest parties of the Mexican right. Now, in October 2019, Peronism has triumphed at the ballot box in Argentina. Alberto Fernandez and Cristina Kirchner imposed a significant defeat on Macrista neoliberalism, perhaps initiating, together with Obrador, a new turn to the left in Latin America.

It is true that in Bolivia Evo Morales had his candidacy for re-re-election very contested, and he is still grappling with accusations of fraud in the very recent victory over the conservative Carlos Mesa, the former president who preceded him in the middle of the last decade. . Also very complicated are the chances of the Frente Ampla defeating the union of the right in the second round of the Uruguayan election, scheduled for this month. And, for the left, the situation in Ecuador is also worrying, where President Lenin Moreno seems to have managed to turn around and rebuild his political support base after the massive popular protests initiated by the rise in fuel prices.

Obrador and Fernandez may thus symbolize a new pink wave in Latin America. Lessons from the recent past can be very helpful to you. To them and to all other leftist governments in the region. In the midst of the chronic and generalized fiscal crisis of the State, a lot of ingenuity will be needed to guarantee economic growth with income distribution and reduction of poverty. At the same time, it will no longer be possible to rely so much on Chinese imports, given the slowdown in the Asian giant's economy.

By the way, betting on the deepening of the primary export model, as several leftist governments did in the previous period (after all, reiterating an economic model of five centuries) may yield trade surpluses, but tends to strain the already very difficult relations with the movements social groups, including native peoples. On the contrary, new left-wing governments will have to expand the mechanisms of democratic participation, bringing together progressive sectors to guarantee political stability and overcome economic crises.

The future of the left in Latin America will pass, in the coming years, through the Zocalo and Plaza de Mayo, in a probable alliance between Obrador and Fernandez. And it will also pass through the streets of Santiago, Port-au-Prince and Quito, recently caught up against neoliberalism, and also through any surprises that may arise in Lima and Bogotá.

Finally, the great unknown remains Brazil. It is not known where it will go, maintaining the current turn to the right or realigning itself, in the medium term, to this new progressive cycle that seems to be taking shape in the region.

*Wagner Iglecias He is a professor at the Graduate Program in Latin American Integration (PROLAM) and at the School of Arts, Sciences and Humanities at USP

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