Saving the Americas?

A look around the world in the twenty first century is encouraging for the progression toward democracy in most of the developing world, but one has to be cautious not to make assumptions about the degree of freedom that accompanies democratic government. We in the United States tend to think of democracy in terms of our own history – in Western models of pluralistic republican systems with power and leadership distributed between three branches of government. There are degrees of democracy, and with the rise of Asia as a center of manufacturing, finance and trade, we are seeing the marriage of authoritarian forms of government with free market economic models.

The emergence of a Chinese model of democracy, which is inclusive yet authoritarian, is apparently a viable and stable form of government under which both private enterprise and state-capitalist enterprise can thrive. Much of Latin America may adopt similar models as those countries struggle with development amidst high levels of crime and social conflict. It is not a new model for Latin America, but one that combines traditional authoritarian forms with a new emphasis on growth, international trade and economic stability.

A good example of a single-party democracy is Mexico under its decades-long domination by the PRI, where each president was hand picked by his successor, and each had nearly dictatorial powers during his term in office. Expect the continued existence of “democratic” systems in Mexico and Latin America that are controlled by a single party, or consolidate power in the office of the president. They may encourage participation by the public at the local level, but elected officials may be little more than advisors or advocates, with little power to determine the final outcome of policy.

Hopefully, Latin America will continue to see more of the move toward pluralism that occurred in Mexico in the 1990s, or the advent of powerful presidential figures with moderate agendas, such as Brazil’s Ignacio de Silva. It would be encouraging to see fewer dictators of the type of Juan Peron of Argentina, Augusto Pinochet of Chile, or Hugo Chávez of Venezuela. Yet Latin America will have authoritarian governments for the foreseeable future, as social divisions, poverty, an epidemic of crime, and bureaucratic ineptitude make social and political progress difficult. Latin America still suffers from social divisions and ineffective or corrupt political elites, which makes poor soil for growing democratic institutions.

The road toward economic and social progress in Latin America necessarily involves a tradeoff between popular participation and implementation of unpopular orthodox economic policies. Economic growth in a time of globalization requires in-country elites to wean themselves from state subsidies or state-granted monopolies, and submit to the discipline of free trade and competition. Inefficient businesses will go bankrupt or be purchased by foreigners. Labor unions will have to cede some power to the market and allow companies to manage for profit. Latin Americans will have to renew their commitment to education, and hold educators accountable to certain standards, as the U.S. is doing with the adoption of testing as a requirement for advancement or graduation. Those in government must govern more responsibly.

Consequently there will always be some tug of war between democratic forms as we experience them in the U.S. and Western Europe, and more authoritarian models as experienced in countries where "diversity" is a problem; not a virtue. Overcoming economic and cultural obstacles to social cohesion may make authoritarian models the default for much of Latin America until those economic and cultural problems are solved. In 2005 the National Intelligence Council, which does research for the CIA authored a report title “The Global Landscape in 2020.” It was a vision of the future of our world after 15 years of globalization, the rise of Asia, and expansion of the world economy and its population. It is a vision that is not dramatically different than the world of today, but more Asia-centric, prosperous and populous.

In that report, Latin America gets short mention, and the outlook is gloomy. The report projects Latin America’s current problems into the future and projects no resolution to today’s obstacles to social and economic progress. Latin America, according to the NIC, will be increasingly irrelevant in the future. The region will be plagued by “internal conflicts,” held back by “government ineffectiveness,” and suffer from high rates of crime.(1) The result will likely be continued class warfare, held in check by authoritarian governments, rather than cooperative democratic systems.

The NIC report preceded another more focused study by an NIC sub-commission titled, “Latin America in 2020.” That report echoed the findings of the earlier NIC report: “Few countries will be able to take advantage of opportunities for development, and Latin America as a region will see the gap separating it from the most advanced nations of the planet grow wider.” (2) Andrés Oppenheimer, who used the NIC report as a springboard for his arguments in Saving the Americas, acknowledges that as the world shifts toward a “knowledge economy” as opposed to an extraction or industrial economy, countries that have invested heavily in education and technology will have the ability to compete globally and adapt to a changing world. Latin American countries, for the most part, will fall behind because of its inability or unwillingness to confront the problems of poverty, crime, poor governance, and mediocre educational achievement. In his own words, Oppenheimer challenges “what has become conventional wisdom, that the region’s current commodity-driven development strategy is inaugurating a new era of prosperity.” (3)

With the current commodity boom presenting new economic opportunity for under-developed Latin American countries (who are commodity exporters), the greatest challenges to Latin Americans may not be economic but political and social. That is, their future may lie in their ability to use the wealth from commodity production to improve their education systems and participate in the international service and technology economy, rather than remain stuck in the stage of raw commodity export. More important, they need to reach a social consensus about the degree of democracy they want, and the degree of orthodox economic policy they can tolerate. Open trade and investment, restrained government spending, less controlled labor markets, and a priority on investment instead of consumption are all pre-conditions to meaningful growth and prosperity in Latin America, but those policies are historically unpopular, and still opposed by many Latin American intellectuals and leftist politicians.

Latin America suffers from a crisis of ideas, as well as a crisis of leadership. Latin American governments need to restore civil order in their cities; attack the drug cartels and organized gangs that terrorize their citizens; encourage foreign investment and welcome foreign corporations; open their borders to free trade; and lean toward orthodox economic policies and free-market solutions to their economic problems. This may seem obvious or unsurprising to a North American reader, but it is very controversial in Mexico and Latin America. Using Oppenheimer’s phrase, there is an “anti-market, anti-globalization dogma that grips much of the region.” (4)

The ideas spread by dependency theory, nationalism, and populism are very much alive in the universities and the public mind. Ironically, it is those ideas that are holding back real social and economic progress, and may ultimately leave Latin America more dependent, not less, on its wealthier trading partners to the North and to the East.

See Andrés Oppenheimer’s books, Cuentos Chinos and Saving the Americas in the Café Mundo Bookstore.

(1) Andrés Oppenheimer, Saving the Americas, (Mexico City: Random House, 2007 p 12)
(2) Oppenheimer, p 12
(3) Oppenheimer, p 15
(4) Oppenheimer, p 16