The recent electoral victory of Gustavo Petro and Francia Márquez in the Colombian presidential elections is part of a broader trend. After suffering several defeats throughout Latin America, the left begins its return to the region. The turn to the left is notable in countries where center-left parties were in power for much of the past two decades (such as Argentina, Bolivia, and probably Brazil) and in places that were somewhat on the fringes of the pink tide of the 2000s (such as Chile, Colombia and Mexico). However, it is not a question of a swing of the electoral pendulum. The recent political history of the region is much more convulsive.
In Bolivia, for example, the left-wing president Evo Morales was ousted at the end of 2019, amid violent protests that forced him to leave the country. Later, after a year of interim right-wing government, the movement he led returned to power with the electoral victory of Luis Arce. In Brazil, the Workers' Party was forced to abandon the presidency in 2016 as a result of a parliamentary coup. Two years later, its main leader, Luiz Inácio Lula da Silva (president of the country between 2003 and 2010) was convicted of corruption and remained in jail for 580 days. Now he is leading the polls for the October presidential election.
The changing complexity of Latin American politics "baffles the observer" and "frustrates the theoretician," the Swedish sociologist Goran Therborn wrote more than four decades ago. His comment has not lost validity. Following this note of caution, what follows could be a brief sketch of the recent political economy of the region.
Neoliberal policies made their appearance in Chile in the 1970s, with the alliance between the disciples of Milton Friedman and the brutal Pinochet dictatorship. In the following decade, they gained global prominence, after conquering the US and the UK. If we advance another decade to the 1990s, we find ourselves at a crucial juncture in Latin America. As various countries moved away from military dictatorships, the gospel of neoliberalism gained ground with the help of the IMF. That creed promised the economic modernization of the region and the overcoming of the difficulties of the previous decade, characterized by foreign debt crises and rampant inflation.
In practice, the widespread adoption of free trade policies, the liberalization of capital flows, and the privatization of state-owned enterprises reduced the ability of the new democratically elected governments in the region to meet the expectations created by political openness. Between 1991 and 1998 there was some resumption of GDP per capita growth, which was accompanied by rising unemployment and inequality. In such a precarious context, the region suffered devastating blows at the end of the 1990s. Capital flight destabilized the fixed exchange rate regimes with which the region had managed, at considerable sacrifice, to control inflation. The result was a wave of devaluations, defaults and recessions. The economic collapse was not long in lighting the flame of popular insurgency. “And it was based on that force”, affirms the Chilean sociologist René Rojas, “that the governments of the pink tide came to power”.
The first center-left leader to come to power in this context was Hugo Chávez, who became president of Venezuela in 1999. He was followed in quick succession by Lula (Brazil, 2002), Néstor Kirchner (Argentina, 2003), Tabaré Vázquez ( Uruguay, 2004), Evo Morales (Bolivia, 2005) and Rafael Correa (Ecuador, 2006). The center-left parties were in power in those six countries until 2015, when the right-wing Mauricio Macri was elected in Argentina in the first of many defeats of the pink tide. Throughout the preceding decade, these six cases would be joined for shorter intervals by leaders of other South American countries with similar political perspectives.
The novelty represented by the pink tide was greeted with relief by the left around the world, as the political challenge to neoliberalism posed by the South Americans contrasted with their growing hegemonic power elsewhere, notably in the global North. In 2006, Tariq Ali referred to Chavez and Morales as the "axis of hope." In 2015, when the tide was beginning to recede, the American political philosopher Nancy Fraser stated that “Latin America has presented a democratizing countertrend to de-democratization, while holding out the alluring promise of a counter-hegemonic alternative to financialized capitalism.”
When it comes to economic growth, wage inequality and poverty reduction, the pink tide parties have a lot to brag about. In the six countries mentioned, the rate of increase in GDP per capita accelerated to an annual average of 3.7% between 2003 and 2011, almost double the world average in the same period. That rate was still well below the breakneck speed of growth in East Asia, but it was still a substantial improvement over the performance of those six countries since the 1980s.
In addition, the fruits of growth were more evenly distributed: the Gini index of inequality, which had increased by an average of 2.5 percentage points in a large sample of Latin American countries during the 1990s, fell by an average of six points. in the 2000s, according to estimates by US economist Nora Lustig and her co-authors. In recent research, those researchers go further and compare trends related to inequality across the region: the distinction between the pink tide countries and those that were not governed by center-left parties in the period allows them to conclude that the The reduction in inequality was much faster in the former.
The success of this redistributive effort was based above all on the increase in the minimum wage and on the expansion of social transfer policies (and, more timidly, of social protection systems). Colombian economists José A. Ocampo and Natalia Gómez-Arteaga affirm that the 2000s were a “golden social decade” for the region. However, although the coverage of social protection unequivocally increased, part of this expansion was based on the financialization of social policy, as argued by the Brazilian economist Lena Lavinas, making it vulnerable to a rapid reversal. In any case, one of its results was the decrease in the proportion of Latin Americans living in poverty. According to data from the United Nations Economic Commission for Latin America and the Caribbean, this percentage went from a maximum of 45.6% in 2003 to 27.8% in 2014.
So was the pink tide all pink? No. The redistributive effort fell short in questioning the deeper structural determinants of inequality and made little effort to change the regressive tax systems characteristic of Latin America and to redistribute wealth. As the Brazilian political scientist André Singer affirms, Lula represented the application of a class program centered on the army of reserve labor, the subproletariat, instead of a program that pitted organized labor against capital. In fact, the share of income appropriated by the top 1% of the population in the main pink tide countries did not decrease significantly in the 2000s (and even increased slightly in Brazil). The main consequence of the redistributive effort was the reduction of wage disparity, largely preserving the income of the capitalists. Reducing global inequality would require more substantial transformations.
The most important limits of the pink tide can be assessed by analyzing the crises in which the countries of the region were involved in the 2010s. As of 2012, the growth rate of GDP per capita began to slow down in all countries of the pink tide. In general, the average of the main countries (excluding Venezuela, so that its extraordinary collapse does not bias the results downward) fell from 3.7% between 2003 and 2011 to 0.6% between 2012 and 2019, that is, before the pandemic. Such a synchronized decline can only be explained by the path of global commodity prices.
In the 2000s, global capitalism consolidated a triangular articulation that attributed different roles to different parts of the world. The US, the UK and the European periphery became the world's consumers and drew a substantial part of world production towards them. They mainly consumed goods produced in the new workshops of the world, such as Germany, Japan and, above all, China. In this distribution of functions, what was left to the pink tide countries, as well as to most African countries and the economies of other places with important oil reserves, was the role of supplying fuels, minerals and agricultural products. to workshops around the world.
The acceleration of world economic growth caused by the triangular articulation gave rise to a boom in the prices of raw materials that would be a double-edged sword for the region. At first, it mitigated South America's foreign vulnerability, stimulated its demand, and expanded the region's political space. But when in 2008 it became clear that the foundations of the triangular articulation were a house of cards, it was a matter of time before the crisis shook South America. As global consumer demand stagnated, the growth rates of the world's bodyshops slowed, and as a result, in 2011, commodity prices began to fall.
Despite all the criticisms of neoliberalism (sometimes rhetorical, other times effective) and the experimentation with redistributive policies, the governments of the pink tide did not question in practice the role attributed to them in the global articulation of capitalism engendered for neoliberalism. His development strategy was ultimately extractivist; that is, dependent in an essential way on the boom in exports of primary products. This is true even in the case of Bolivia and Ecuador, where radical legal innovations were introduced in relation to the rights of nature.
The chosen strategy not only had questionable environmental consequences, but also led to the imposition by center-left governments on indigenous groups and peasants of a homogenizing concept of modernity. The Argentine sociologist Maristella Svampa speaks of “a vertical dynamic that bursts into the territories and in its wake is destructuring regional economies, destroying biodiversity and dangerously deepening the process of land grabbing, by expelling or displacing rural, peasant or indigenous communities. , and violating citizen decision-making processes.”
Reliance on extractivism would turn out to be, in a political and economic sense, the Achilles' heel of the pink tide. The downward economic shock put pressure on redistributive policies and reignited political struggles rooted in class dynamics. Waves of protests once again filled South American streets and squares starting in 2013 and were often violently suppressed. In many cases, the ruling classes used the opportunity to back the replacement of leftists with their preferred political representatives.
Then came the defeat. In Argentina, extreme neoliberalism was returned to the government by popular vote, with Macri, in 2015. A similar transition would take place in Uruguay in 2020. However, the electoral hegemony of the pink tide governments proved more resistant in Bolivia and Brazil, so their opponents resorted to coups. In Ecuador, Correa's handpicked successor, who became president in 2017, turned his back on his pink tide origins and aligned his government with the right-wing turn. The Venezuelan case is different: there, the political antagonism became increasingly violent, the government embraced openly authoritarian means, and the stalemate gave rise to the current human tragedy.
The right did not offer an alternative strategy that could aspire to some form of hegemonic stabilization. The turn in the economic policies applied after the defeat of the pink tide has made the rich richer, but has not convinced the rest of the population. This is true both in the case of the more conventional neoliberal governments (in Argentina and Ecuador) and in the case of the extreme right variant (Brazil). However, the dismal economic results do not mean that the turn to the right can be short-lived. In reality, by deepening the economic and social crisis, the right-wing governments in the region put democratic institutions at risk and thus open the way for them to be challenged by the authoritarian ultra-right. In recent years, the crisis of democracy has become a truly global phenomenon. However, it is not unreasonable to consider that the authoritarian threat acquires a special gravity in Latin America, with a democratic culture that is not very rooted and traditionally anti-democratic ruling classes. In many countries, such as Brazil, Chile, and Colombia, traditional right-wing parties have been eliminated and replaced by far-right variants.
However, in this explosive context, the center-left candidates have triumphed in the elections of several countries and point to the possibility of a new pink tide. Some are direct heirs of the original tide (Alberto Fernández in Argentina and Arce in Bolivia) and others are opening new chapters of center-left politics in their countries (Gabriel Boric in Chile, Gustavo Petro in Colombia and Andrés Manuel López Obrador in Mexico). . The challenges of this latest generation of leftists are more important than those of their predecessors.
First, to avoid being a mere momentary pause in Latin America's descent into autocracy, they must immediately bring about concrete improvements in the living standards of the popular classes and show them that democracy can work for many, not just the poor. few located at the top. It is the only way to stop the rise of the extreme right. To do this, they will have to confront the neoliberal calls for austerity, which limit the capacity of the State to face the challenges posed by the secular inequalities in the region. The fact that both Fernández's Argentina and Obrador's Mexico have applied much lower pandemic stimuli (as a percentage of GDP) than those applied by Bolsonaro's Brazil or Piñera's Chile indicates that it cannot be taken for granted that the new tide Rosa will face that challenge.
Second, they must go beyond extractivism. Having seen the crisis of the previous strategy, in their own or neighboring countries, the new leaders are aware that they must find a new path. That horizon does not imply, of course, the rejection of the export of natural resources, but rather the commitment to build an economy protected from the instability of the prices of raw materials and that does not subject its population and its environment to interests of extractivist capital.
Rejecting austerity and, at the same time, overcoming extractivism will also require expanding political space in a way that does not depend on income from the export of primary products. Various tools could help, from the regulation of capital flows to further integration of the region's payment systems. The current global acceleration in inflation and the consequent contraction in global liquidity can be seen as a commodity boom in reverse: it shrinks policy space and poses challenges to economic policy in Latin America, but it also helps it resist the siren songs of the extractivist strategy.
After World War II, global capitalism promised that access to the heights of the developed world could be granted to those economies that integrated into the world market, either by exporting what they had in relative abundance, or by attracting manufacturing production with manual labor. cheap and labor regulations favorable to companies. In retrospect, and given that global hierarchies in terms of per capita income have remained largely unchanged since at least the 1960s, it is clear that these paths were illusory and that those who claimed that development itself was a myth were correct. . Among them was Celso Furtado, the dean of Brazilian economists.
In 1973, exiled from Brazil and disillusioned by the then recent coup against the government of Salvador Allende in Chile, he wrote: “For the masses of the Third World, the dilemma is to stay where they are and for a few small minorities in their respective countries to share the pleasures of the modern way of life, while they are not prepared to build for themselves a different destiny”. Even in his most pessimistic version, Furtado did not throw in the towel: he left open the possibility that the “third world masses” would build for themselves a destiny different from the one imposed by the myth of development. Half a century later, when the left returns to government in Latin America, its hope is a beacon.
