Reclaiming the future
The struggle against neo-liberalism and its various agents has taken a new impetus in Latin America, writes Faiza Rady
Are the party lights finally dimming? If so, are we now witnessing the process of a partial unmaking of the neo-liberal world order on the Latin American continent? Hopes to this effect ran high following the wrap-up of last week's World Social Forum (WSF), the third annual anti-capitalist globalisation meeting in Porto Alegre, Brazil. Hosting the country's recently elected leftist President Luiz Inazio Lula da Silva, WSF delegates celebrated his victory as a defeat of neo-liberalism. "There's never been a president of Brazil who's been a labourer," said Emilio Penna, a 26-year-old Uruguayan student, adding that, "politics have always been in the hands of the rich."
If Lula is Brazil's first-ever president to hail from a working class background, his election signals the emergence of "people power" in Brazil -- along with sweeping political changes.
Nascent people power, however, is by no means a phenomenon unique to Brazil. Vast pockets of resistance have recently emerged throughout Latin America, a continent devastated by two decades of neo-liberal regimes.
As Ignacio Romanet, a leading organiser of the WSF, points out in the French monthly Le Monde Diplomatique, it was also people power that ultimately brought down the government of Argentinean President Fernando de la Rua in December 2001. Burdened with crippling debt, resulting in the worst economic crisis in their history, with 37 million living in poverty and one third of the active population swelling the unemployment lines, Argentines took to the streets. In the wake of mass demonstrations saying "No to globalisation", "Down with the International Monetary Fund" and "No repayment of the debt", de la Rua was forced to resign and Argentina defaulted on its debt.
A similar kind of rebellion against the ravages of unbridled globalisation led to the election of populist President Hugo Chavez in Venezuela in 1998.
Likewise in Ecuador, a peasant and native people's uprising unseated President Jamil Mahuad after his ill-fated decision to "dollarise" the economy in January 2000. With 70 per cent of Ecuadorians living under the poverty level and no end to the International Monetary Fund's (IMF) "austerity" measures in sight, Ecuador's poor had simply had enough.
In November 2002, a coalition of leftist parties and indigenous people elected the "presidential candidate of the poor", Lucio Gutierrez, a former army colonel of working class background. A virulent opponent of creeping neo-liberalism, Gutierrez opposes the establishment of the Free Trade Area of the Americas (FTAA) in 2005 -- a long-standing United States project to turn Latin America into its own neighbourhood supermarket.
In Peru in November 2000, a series of mass demonstrations ultimately led to the resignation of President Alberto Fujimori, accused of corruption and the occasional financial misdemeanour. Fearing the wrath of his people, Fujimori fled to Japan where he is leading the good life.
Besides making and unmaking presidents and governments, a main tenet of globalisation -- namely the privatisation of services enshrined in the World Trade Organisation's (WTO) General Agreement on Trade in Services (GATS) -- has also provoked popular uprisings in the region. By 2005, GATS aims to liberalise "services" -- loosely grouped into a category that includes education, healthcare, environmental services, energy and anything else we pay for that is not strictly defined as a material commodity.
At the WSF, writer and activist Maude Barlow cited the devastating effect of water privatisation on Bolivian farmers. In 2000, under intense pressure from the World Bank, the Bolivian government decided to sell the city of Cochabamba's public water system to the highest bidder -- a private US water corporation. Unsurprisingly, massive water rate hikes ensued. As a result, the majority of Cochabamba's small farmers had to pay up to a third of their income for their water, more than they spent on food. When petitions and collective complaints failed to lower water rates, the unions declared a four-day general strike and thousands took to the streets -- bringing the city to a standstill. Following a protracted struggle between the farmers and the authorities, the municipality finally backed down and returned the city's water system to public control. In Cochabamba people power saved the day, "but it was a victory that may not last," warned Barlow.
Cochabamba's kind of victory is threatened by the FTAA, a projected market of 34 countries that will encompass all those of the Western hemisphere, with the exception of Cuba. With a population of 800 million, and a combined gross domestic product (GDP) of $11 trillion, the FTAA would be the largest free trade zone in the world. Modelled on NAFTA, the US version of the FTAA will be exclusively fine-tuned by the Bush team until the treaty comes into effect in 2005.
As a major threat to Latin America's poor, the FTAA was high on the WSF's agenda. "No one has consulted with those of us who will be most affected by the FTAA, which represents nothing more and nothing less than the interests of American capitalism," said Ecuadorian-Indian delegate Doris Trujillo.
Although US capitalists have wide- ranging interests elsewhere on the globe, the Latin American continent is really where it is at. According to economic analyst James Petras, writing in the alternative news Web site Rebelión, Latin America represents a pot of gold for US businesses. Between 1990-2002, banks and transnational corporations milked a whopping one trillion dollars in profits, interest payments and royalties from the region. During the same period, it is estimated that Latin American elites laundered close to $900 billion in US banks. Latin American political elites -- in tandem with narcotics businessmen, illegal arms dealers and Mafiosi prostitution rings -- are hitting the jackpot time and again under neo-liberalism. While abject poverty and unemployment levels continue to rise under an IMF driven deregulation process, the entrepreneurship of the crooked elite thrives thanks to "highly reputable" US banks. After all, it was CitiBank who transferred $100 million of Raul Salinas' -- the brother of former Mexican President Carlos Salinas -- illicit money to the US.
Aside from the dubious morality of neo-liberalism, the figures show Latin America as an invaluable asset in the US's drive to balance its trade balances. This is where Latin America has represented a pot of gold for various US administrations, particularly the Bush administration which, on Monday, reported a record $300 billion trade deficit.
Between 1990-2002, US trade surpluses with Latin America covered over 25 per cent of its deficit with Asia and approximately 50 per cent of its deficit with Europe. Things really got going when US corporations were able to achieve 70-80 per cent cost reductions following corporate relocations to greener and more profitable Southern pastures. Here, corporate profits could exceed US rates of return by two or three times.
The bad news is that North American corporations are bleeding the continent dry. "The poverty and stagnation of Latin America is a product of the concentration and centralisation of wealth and expansion of the US," commented Petras.
It is the struggle against North American corporate agents like the FTAA, the WTO and its various offshoots that has mobilised the anti-capitalist globalisation struggle in Latin America. In the words of President Lula, "it is not possible to have an economic model where a few people eat five times a day and many people go five days without eating."
