Andean Crisis is Over

Take a look. Very very interesting — and check out Chavez’s whispers to Daniel Ortega.

Morales and Opponents Defend Bolivia’s Unity

Evo Morales, the president of Bolivia, along with the governors of the opposition agreed last week to create a national charter that would prevent the country from further disintegration. Four out of nine governors of the State Departments have declared autonomy in protest to the new Constitution and its plans to redistribute profit from the countries natural resources to the indigenous populations of Bolivia.

The Bolivian’s main suspicions of President Morales’ new Constitution is that the President is trying to gain the indigenous population’s support as a means to bring across his personal agenda. Moreover, adversaries are accusing President Morales of following Venezuela’s President Chavez’s footsteps, because the new Constitution has been approved without the presents of the oppositions group in the Constituent. Until there is further compromises and negotiations between President Morales and the governors, the charter cannot be solidified into permanent legislation.

http://oglobo.globo.com/mundo/mat/2008/01/08/morales_adversarios_defendem_unidade_da_bolivia-327920379.asp

Argentina’s Presidential Decree

Argentine President Kristina Kirchner recently used her presidential decree powers in two high profile cases.

First, and to the dismay of many living in Argentina’s west and south, the President used a decree to temporarily move all clocks forward one hour starting on December 30^th. This adjustment, which leaves much of the country under daylight well into the night, is hoped to alleviate Argentina’s power shortages and Buenos Aires’ recent blackouts.

Then, in a move that will bring the first high speed train to Latin America, President Kirchner used a presidential decree to grant a 1.5 billion dollar contract for a high speed train link between Buenos Aires and Cordoba to a consortium headed by the French company Alstom.

These two decrees demonstrate the proactive power afforded to Argentina’s President by the country’s institutions, and more generally, highlight the powers of presidential decrees in presidential systems. The result, in these two cases, has been decisive policy making on two issues calling for quick decisions, although it appears both decisions may have some feeling left out.

For more on these two stories, please see:

http://www.economist.com/world/la/displaystory.cfm?story_id=10566820

http://www.hemscott.com/news/latest-news/item.do?newsId=57266947191808

-Argentina Group

Credible threat or political stunt

Ok the obvious, Colombia recently sent a military operation into Ecuador’s territory to kill FARC’s second in command.  The Colombian struggle against the FARC has taken on a transborder nature.  Beyond Colombia, FARC operates in both Venezuela and Ecuador.  For there to be an effective war against this group, there cannot be ’safe havens’ within other countries.  In part, the extreme response from Ecuador and Venezuela in troop mobilization is unexpected.  While the Colombian strike may set a scary precedent it is clearly not a threat to the political stability within these countries.  I will make the claim that the troop mobilization by Venezuela is only political posturing to gain domestic political support.  In fact, this move is the logical conclusion of Tanaka’s analysis about how Chavez has been able to increase his authoritarian power.

In “The Thrid Wave of Democratization in Latin America: Advances and Setbacks” Martin Tanaka explains that traditional models of democratic outcomes fails to predict the recent increase in authoritarian power in Venezuela.  What Martin does find is that these errors of the model are best approximated by the dominate party power.  Martin argues that Chavez came to power in part because of his good timing and his charisma.  While he has been able to use his popularity to push past a constitutional referendum, his most recent bills that were put to voters showed markedly weaker support for the presidents policy.  This is the similar indicator used by Tanaka to measure the decrease in power of the previous political parties which lead to the Chavez regime.  As he came to power, Chavez was able to blame the political problems of the country on the previous leadership, however now that he is in control voters are looking to blame him for any negative political outcomes.  His move to mobilize troops against Colombia serves two purposes.  First, it plays on anti-US feelings by targeting a US ally who receives billions of dollars in military aid. Second, it unifies to people against an outward enemy, i.e. Colombia military incursions into other sovereign territory.

It appears that Colombia also believes the threat from Chavez isn’t credible.  Colombia has not mobilized their troops to the border and they have instead turned to the international community and the United States for support.  This hurts Chavez’s ability to spin the Colombian response as a justification for escalation.  We can predict that this conflict with transition into strong anti-US rhetoric from Chavez in the near future and blame Colombian action on US support.  This decreases the chance of regional violence but maintains an enemy for Chavez to blame for economic disparities.

Brazil’s battle with Gang Violence and Police Corruption

Rio de Janeiro and Sao Paulo boast murder rates of 40 and 18 per 100,000 citizens, respectively.  Sao Paulo’s rate has dropped from 35 per 100,000 citizens in 1999. 

The gangs in Rio de Janeiro and Sao Paulo have real power.  In September of 2002, Rio de Janeiro suffered “Black Monday” when schools, stores, offices, markets, and transportation shut down to gang influence.  In Sao Paulo, the Primerio Comando da Capital (PCC) staged a multi-prison rebellion in 2001 and orchestrated a five-day wave of violence in May of 2006.  Within the state, 150 people were murdered, 82 buses were burned, and 17 bank branches were attacked as more than half of the 140 prisons erupted with rebellions.  All organized by mobile phones from prison cells.

The ongoing struggle between the government, police, and Sao Paulo’s main criminal gang (Primeiro Comando da Capital) has and will continue to disrupt public safety.    The P.C.C. may control 140,000 prisoners in Sao Paulo alone with another 500,000 supporters outside the prison system.  These members produce millions of dollars in monthly fees for the P.C.C. and helped coordinate the chaos in May 2006.  The state’s attempt to dissipate the gang’s strength by separating members and imprisoning them in other states has led to a strengthening of the organization nationally.

Sao Paulo implemented reform in 1990 that mandated jail time for selling drugs and has resulted in overcrowded prisons with 35% more prisoners than space.   With such high concentrations of drug dealers, the prisons have become gang centers that breed increased levels of violence and insecurity.  State officials often fight back with a heavy hand.  Sao Paulo’s May 2006 incident resulted in the death of 100 “suspects.” 

Brazil’s pardoning labor code protects the jobs of many public servants.  Job security and low salaries complement corruption as police are easily enticed by bribes with little fear of losing their job and few incentives to remain clean.  State officials have attempted to infiltrate the corrupt police force but only to have them reinstated by court order. 

- The Brazil Group

http://www.economist.com/agenda/displaystory.cfm?story_id=E1_GJPJGSG

http://query.nytimes.com/gst/fullpage.html?res=9B04E5DD103DF933A15753C1A9649C8B63&sec=&spon=&pagewanted=1

http://www.economist.com/world/la/displaystory.cfm?story_id=6950391

http://www.economist.com/world/la/displaystory.cfm?story_id=9597408

http://www.economist.com/world/la/displaystory.cfm?story_id=7922722

http://pinr.com/report.php?ac=view_report&report_id=495&language_id=1

Panama, Trade, and Private Interests

A recent article in the Tico Times, a Central American English language newspaper, reported on Panama’s propensity for free trade agreements, the most recent with Guatemala (http://www.ticotimes.net/dailyarchive/2008_02/0227083.htm). The recent referendum in Costa Rica regarding it’s participation in CAFTA and Panama’s referendum about canal extension indicate the politically charged nature of trade oriented decisions in the region. Although these governments have taken the less risky route of letting the public decide on these two issues, Panamanian multiple free trade agreements have been made by the government independently. This leads us to question the influence of interest groups outside the government in influencing, or failing to influence, these neoliberal policy measures.

Panama has a unique position as a country who’s history is tied to its political and economic function as a nation that services the interests of other nations, most recently characterized by relations particular to the Panama Canal, the Colon Free Trade Zone, and the off-shore banking industry*.  Because of this scenario, it is fair to assume that Panama’s most powerful interest groups, like those in most countries, represent private enterprise in these sectors.

This marginalizes labor and environmental lobbies and the U.S. State Department’s 2005 Human Rights report questioned the extent of worker rights in Panama, particularly in export processing zones (EPZ’s).  For example, unions are not granted the right to strike in EPZ’s and Panama’s laws regulating the zones don’t include arbitration or labor dispute settlement guidelines.  Furthermore, the report noted that child labor is a problem in the country. This leads us to believe that neoliberal economic policy in Panama is developed out of private industry partnerships with politicians with little input from labor representation or other interest groups.

*Dougherty, Mary. A Study in Civil Society, Scales of Influence, and Corruption in Panama.  University of Pennsylvania, 2002.

Leader Moves To Dominate Civic Groups In Venezuela

This article from September 2000 shows Hugo Chavez’s attempt at using informal means to ensure his power and control over the government. The article explains that to begin his plan, Chavez wanted first to get rid of the largest labor union in Venezuela, the Venezuelan Worker’s Confederation (CTV) in order to start moving labor unions under the control of his “revolutionary” movement.

In the same article Venezuelan civic groups (human rights associations, religious groups and civic groups) are addressed. Chavez decided that these groups would not have a part in “participatory democracy” or in designating Supreme Court nominees anymore.

In consolidating labor unions under one “government dominated union” and not allowing civil groups to have any influence in decision-making, Chavez is constraining politics outside of formal institutions and is therefore able to hold on to and seize more power over the government.

 

http://query.nytimes.com/gst/fullpage.html?res=9A0DE1DD1E39F933A2575AC0A9669C8B63&sec=&spon=&pagewanted=all

 - Venezuela Group

 

 

 

Role of Concertación in implementation of Washingotn Consensus in Brazil and Mexico

Ben Schneider’s article (Confidence and Concertation in Brazil and Mexico, 1997) attempts to explain why Brazil and Mexico, both pursuing similar ISI development strategies at the beginning of the 1980’s, took different approaches to neoliberal economic reform, with Mexico enacting deep and rapid reforms and Brazil taking a slow and less drastic approach. 

While he attributes the depth of reform to the severity of the economic crises that preceded them, Schneider seeks to explain the pacing and success of stabilization and liberalization policies, arguing that this depended heavily on the nature of government business relations.

In government-business relations, he downplays the importance of high-level officials relationships with business leaders and the process of policy hold-up by business interests earning rent from the status quo.  He also faults institutionalist explanations for failing to explain the timing of reforms.  Instead, he asserts the importance of concertación (or in Brazil pacto social) a process of regular meetings between representatives of business associations, the government and sometimes labor unions to negotiate the details of policy implementation.  He argues that neoliberal reforms  (such as policies to combat hyper-inflation)  must be both credible and flexible to succeed but that flexibility undermines credibility.  Concertación is one of the few ways to enhance both.

He points to high levels of concertación in Mexico as having reduced the costs of reform and led to more rapid stabilization than in Brazil where concertación was weak and restructuring programs where “stabilization came and the implementation of structural reforms such as trade liberalization was slow and uneven”. 

So one is apt to ask, why was concertación weak and not fomalized in Brazil as it was in Mexico?  Schneider argues that the difference was political stability, strong business associations, and shared perceptions of vulnerability.  Brazil was a fledgling democracy with many parties attempting to lead the country in different directions, while Mexico was firmly under PRI control.  With respect to business associations, Mexico had a formal peak organization (the Consejo Coordenador Empresarial or CCE) representing sectoral associations, so that officials could effectively communicate with business as a whole.  Brazil lacked such a business umbrella organization.   

Although he successfully motivates the role that Concertación plays in the policy making and implementation process, he fails to meaningfully explain why concertación differed in Mexico and Brazil, without relying on the very explanations for reform that he bgins the article by downplaying.  The first difference that he argues led to differences in concertación was “political stability”.  Its hard to see how this departs from institutionalist arguments.  If political stability is not driven by institutions  and exogenous shocks, then where does this variation on “political stability”come from?  Secondly, the existence of peak associations in business as a “cause” of differences in concertacíon seems plausible but is of little value without going deeper.  What caused business in Mexico to organize in representing its preferences to government while business in Brazil did not?  Again, it would be hard to answer this without making institutional arguments or relying on the incentives of rent-seeking coalitions to apply pressure through political means.  Schneiders third difference contributing to variance in concertación, “shared perceptions of vulnerability” is not really developed. 

The argument is interesting and the article offers good insight into business government relations, the processes by which business preferences are organized and represented to government, and he drivers of successful stabilization programs.  But the conclusions offered overreach or leave important questions like why Brazil lacked a peak business organization or formalized concertación procedures unexplained.   It would be fascinating to find a source of difference between Brazil and Mexico separate from institutional factors or rent-seeking behavior that led to differential neoliberal reforms.  But concertación does not seem to meet this criteria.   It appears to be essentially the result of both of these.

Ecuador’s (proposed) 20th Constitution

Ecuadorian President Rafael Correa took office in 2006, vowing to write a new constitution. If a new constitution were to be ratified, it would be the 20^th time the country has adopted a new constitution since its independence in 1830. Constitutional change is commonplace – in fact, former President José María Velasco Ibarra went so far as to completely abolish the constitutions of 1935, 1946, and 1970, claiming that they “limited the general will of the people.” While President Correa has not made identical claims, he does appear to be echoing Velasco Ibarra’s populist rhetoric in regards to the new constitution.

 

One example of Correa’s populist underpinnings is his claim that the Constitutional Assembly currently drafting the new constitution will “wrest power” from the “corrupt elite.” Populism in Ecuador has been characterized by a significant “demonization” of the opposition, whether they are specific political rivals or “the oligarchy” in general. In proposing yet another constitution, Correa claims to be bettering the situation of “the people,” whose concerns and interests he allegedly to embodies.

 

However, it appears that “the people” have some significant doubts as to whether Correa is actually representing them. In April 2006, when citizens voted on the referendum to create a Constitutional Assembly, the proposal for a new constitution was supported by 82% of all voters. By November 30, approval ratings for the new constitution had fallen to 62%, and continued to fall through the new year. Current polls show that only 38% of individuals favor the writing of a new assembly by the Constitutional Assembly.  

 

This decrease in support from “the people” may be due to the lack of actual representation present in the creation of the new constitution. In the 2006 election, no representatives from President Correa’s party won seats in the (now disbanded) legislature. However, on the September 30 election for the 130 assembly members, Correa’s supporters won 80 seats, and 69% of the vote. With more than a simple majority holding power in the Assembly, Correa has little interest or incentive to cooperate or reach a consensus with opponents.

 

Still, the referendum to ratify the new constitution must be held in a nation-wide vote, and the decreasing approval ratings seem to foreshadow a similar fate for Correa’s constitution as that experienced by Chavez’s recently failed referendum. In order to enact significant, representative change, Correa must drop his populist rhetoric, and embrace the necessity of dialogue and compromise with the opposition. Otherwise he may be the 9^th president in the past 11 years to fail to complete a full four-year term.

Quarrelsome Chileans acting out

In the last couple years, two major issues have persisted in Chile: inequality and windfall copper profit – which is Chile’s main export. Inequality is a contentious issue that continually generates criticism today of Chile’s problems in everything from labor standards to education. The effect of inequality has found its way into politics outside of elected institutions (as can be seen in the articles below). Additionally, the price of copper, of which Chile is the world’s greatest supplier, has reached historically high levels. This seemingly unforeseen government revenue has been generally beneficial to the country; nevertheless, citizenry’s demand for action against inequality has only grown more vocal in the face of this financial accumulation. Although Chile’s unions and other non-elected actors are not as strong as in other Latin American countries, such as Mexico’s teachers union, comfort in confronting the government and the incentives to demand certain responses are correspondingly increasing.

“A worrying precedent“

“Chile labor union protest draws nationwide support“

“Schools out“