International Socialist Archives

International Socialist was the journal produced by our tendency until January 2001, when we left the Committee for a Workers International. We now produce the journal Frontline.

Latin America

Throughout Latin America a revolt is brewing against the effects of globalisation and the associated economic policy of neo-liberalism. For globalisation read economic domination by foreign multinationals. For neo-liberalism read the squeezing of the state sector and the privatisation of telecommunications, electricity, water, mineral and other natural resources, most often to outside interests and most often sold for a song.


In return for adopting neo-liberal policies governments have been granted credit from the IMF and other world financial institutions. In other words they can put themselves in debt in exchange for IMF sponsored "reform".

The effects of more than a decade of being stretched on the neo-liberal rack are now acutely obvious across Latin America.

According to the World Bank, 45% of the population of this vast region exist in extreme poverty, surviving on a dollar a day or less. The gap between Latin America and the developed countries has been widening for more than 50 years. neo-liberalism has accelerated this process. In terms of per capita income this region has now fallen behind the Middle East, East Asia and Eastern Europe.

Neo-liberalism also reflects itself in rampant corruption. Local businessmen and sections of the military and political establishment have placed themselves in the pockets of the multinational corporations and have been rewarded for services rendered. Crime has also risen to pandemic proportions and human life has become correspondingly cheap. In Brazil there are now about 50,000 victims of violent homicides each year.

The other most striking feature has been growing inequality. This has been a world phenomena in the 1990s, but nowhere more so than in Latin America, especially in Brazil, Mexico and Chile where faster growth has enormously widened the gulf between rich and poor. The richest 5% of the population now earn more than 50% of the region's income. The poorest 20% have to make do with just 3%.

In the last two years growth rates have slowed, spelling misery for millions. A sluggish 2.3% growth rate in 1998 was followed last year by a rise of 0.3%. Given the increasing population these figures represent a real falling back in living standards, placing an impossible burden on already impoverished people.
For some time a revolt has been brewing against this intolerable situation. There have been significant movements of workers, peasants and of the indigenous people in a number of countries.

In Brazil, where 90% of the land is in the hands of the richest 20% and where the bottom 40% own only 1%, the movement of the landless, the MST, has led a campaign of land occupations. Over 30,000 people have taken part in land seizures.

Last May a quarter of a million students of the Autonomous National University of Mexico struck against raised tuition fees and other injustices. Workers in other sectors supported their struggle and demonstrations of 100,000 and more took place in Mexico City.
At the same time workers in Peru, where half the population live in poverty, were moving into action against the dictatorial Fujimori government. A 24-hour general strike in May 1999 expressed working class anger at Fujimori's neo-liberal policies and demanded an election. A National Day of Struggle followed in August in which tens of thousands took to the streets.

These movements have been as overtures for even bigger and more explosive developments in Venezuela, Ecuador and Bolivia. In each of these countries the flag of resistance to neo-liberalism has been dramatically raised in events which will have repercussions worldwide.

Venezuela, despite being the number three oil exporter in the world, is in the throes of its worst economic crisis for forty years. An estimated 80% are struggling below the official poverty line, with 36% living on less than a dollar a day.

Two years ago, in December 1998, former army officer Hugo Chavez, who had led a failed coup attempt six years earlier, was elected on a radical programme of opposition to the austerity measures of the outgoing regime. Lambasting the neo-liberal agenda as a "dogma of individualism" he leaned, populist style, on the masses and began to take measures against the economic and political establishment.

Fifty thousand soldiers were mobilised in "theatres of social operation" to take decision on road repairs, and on hospital and school building programmes. Taxes on the rich were accompanied with a crack down on wealthy tax evaders. A purge of sections of the judiciary and old state apparatus was begun.
Facing parliamentary opposition from the political representatives of the old order Chavez created a new Constituent Assembly. In the first elections to this body the pro Chavez coalition the Patriotic Pole took 91% of the seats in an overwhelming demonstration of popular support for his radical measures. As for the two major parties who had dominated Venezuelan politics for forty years neither won even a single seat.

At the end of the year torrential rain led to flooding, mudslides and a disaster that claimed around 50,000 lives. Like all such disasters it arose partly from nature but partly also from politics, from deforestation, from the legacy of corruption and from poverty. The result was to push the Chavez government further to the left.

Chavez mobilised the armed forces and instituted emergency measures to re-house 100,000 people within days. He himself put on his paratroop uniform and joined the helicopter relief work. It was at this time that a new constitution was adopted by a referendum in which over 50% voted despite the disaster.

This constitution, by any historical standards, stands as a radical document. Although it allocates excessive powers to the president it establishes a single chamber parliament. Deputies are barred from having outside interests. Judges are to be elected. Social measures enshrined in this document include free health care, social services and education, equal pay for men and women, a reduced working week, down from 48 to 44 hours and a pension of no less than the average wage. It gives the state power to take over any company, a provision Chavez threatened to put into force after the flooding.
What has been happening in Venezuela has echoes of the Portuguese revolution of 1974 when sections of the junior officers overthrew the old dictatorship and, under pressure from the working class, began to take measures against capitalism. It has similarities also with the radical government of Salvador Allende which ruled Chile between 1970-73 and which was crushed by the iron heel of Pinochet.

The future of the Chavez government is unsure. Under the pressure of the economic crisis, and faced with the anger of the working class, it is possible that it could be pushed into further opposition to neo-liberalism and globalisation. However this is not certain. This government is also attempting to lean on sections of the capitalist class and is under pressure from this source to deliver in its interests. Chavez has met with foreign companies and given assurances that he will enact privatisation.

The fact that Chavez is trying to lean on different class forces and does not have a programme for the complete abolition of capitalism could ultimately undo his government. History shows that it is a fatal mistake not to complete the process of revolution once it has been begun.
In Portugal there was no leadership to complete the overthrow of capitalism in 1974 and the result was a long drawn out counter revolution in which the old property relations were restored. In Chile reaction came in the form of a bloody coup and the massacre of thousands of working class fighters. Chavez's attempts to lean on the capitalist elements of his coalition could disillusion and disorientate the mass movement and encourage sections of the military to try to oust him.

That the policies of Chavez have had an impact beyond Venezuela was clear in the insurrectionary events which took place in Ecuador at the beginning of this year. A movement spearheaded by the organisations of the indigenous peoples, who make up 40% of the population, overthrew the government and established a National Salvation Assembly. Looking to Venezuela the new leadership proclaimed their "Chavismo" after Chavez.
This uprising came after a year of mobilisations against privatisations and attacks on labour rights. Three general strikes had been called, as well as strikes by oil workers, state employees, transport workers, teachers and others. On 9 January the government introduced what was the last straw for the mass of the population, the dollarisation of the economy.

Dollarisation meant price rises of up to 300%. The measure was accompanied by further privatisation and greater labour flexibility. With 17% unemployed, 62% living in poverty and a huge debt of 1.5 billion dollars it was one neo-liberal step too far.

A march on the capital by the organisations of the indigenous people was the front rank of an insurrectionary mobilisation of the working class. In eighteen hours the government was overthrown. Real power rested with the working class, peasantry and indigenous peoples.
But as in Venezuela there was no clear leadership of this movement. The Patriotic Front which had led the previous mobilisations, like Chavez's Patriotic Pole, included working class organisations but also representatives of "honest businessmen" and of the "enlightened military".

The working class held power but with no conscious leadership this could not be consolidated. A three person National Salvation Junta was set up. As well as the leader of CONAI, (the co-ordination of social movements) it included the former head of the Supreme Court and a radical army officer.
An insurrection that is not completed inevitably loses momentum and falls back. Once this happened the military representative on the Junta was replaced by a right wing general. He dissolved the Junta, arrested some officers, and handed power to the former vice president. Before doing any of this he consulted the US embassy and obtained their approval for his actions. Under the new president, dollarisation stayed in effect.

With the movement in Ecuador checked for the moment the focus for the continental revolt against neo-liberalism switched to Bolivia. As with Ecuador a single measure provided the spark that triggered an insurrectionary revolt.

In this case it was a proposal to privatise the water in Bolivia's second city, Cochabamba. The manner of this privatisation shows the rapacious nature of the foreign capital which has moved in on the resources and services of Latin America.

Cochabamba's water was bought or rather given for nothing to the International Water Company of London, itself part of the US based Betchel corporation. IWL immediately announced big hikes in the water price. Part of the increase they said was to pay for a local project to provide water the Misicuni dam.
Local people were enraged at the price rises and the reason given. The Misicuni project was opposed by the World Bank who suggested alternative schemes at a fraction of the cost. Misicuni water will cost six times that of existing sources. One of the owners of the dam, which has not yet been built, is IWL.

The 40% rise in water prices announced in April meant an increase of around twenty dollars a month, this in a region in which the minimum wage is only one hundred dollars a month. Predictably the announcement triggered a revolt. A union/community coalition (Coordinadora del Agua del la Vida) organised huge protests.

These, and the repression with which they were met, quickly triggered an insurrectionary mood across the country. By the time the government announced a halt to the water privatisation the accumulated grievances of workers and peasants on a host of issues had come to the fore.

More than 300,000 peasants across the country began closing roads demanding protection of the coca plantations. Workers also began to take action, as did students who began to protest at the lack of funding for education. Events took a dramatic twist when police in La Paz mutinied demanding a wage increase and an end to corruption. They occupied the police headquarters and appealed to other garrisons to join them.
The government surrounded the police building with troops. As the mutiny spread they offered a 50% wage rise but the insurgents were not convinced it was genuine and stayed in place. Eventually the army was given the order to attack but the 1,000 police in the building resisted and drove them back. Only then did the government back off and meet the insurgents' demands.

Meanwhile in Cochabamba protest leaders were arrested. Troops opened fire on a demonstration killing three and wounding 50. The declaration of a state of siege only further ignited the movement. Miners announced they would take action against it and pressure built on the trade union leadership to call a general strike. The government had no choice but to retreat in the face of a movement that would likely have ended in its overthrow.

These events are not the last word in Bolivia, Ecuador, and Venezuela or in other parts of Latin America. Since the April uprising in Bolivia there have been big mobilisations in Peru against Fujimori's efforts to rig the Presidential election. Fujimori should not have been able to run because the constitution, which he put in place, prohibits anyone standing for a third term. He simply set this aside and proceeded to manipulate and rig the election. Eventually the opposition boycotted the poll and the final result a victory by Fujimori, but with a massive rate of abstention lacks credibility.

In Brazil, workers, especially in the public sector, have moved into action against the austerity policies of the Cardoso government. 40,000 demonstrated in Sao Paulo on 18 May, only to be followed by an even bigger mobilisation as almost 100,000 took to the streets on 25 May.
Through all of these movements one thing is clear. The working class is the decisive force in the region. Together with the peasants and the indigenous people it is the working class who can bring about decisive change. What is lacking at this stage is a leadership to harness this power and fight for a socialist alternative to the neo-liberal agenda.

Hence the tendency for the political opposition to assume a broad all class character at the top, while leaning on the working class and the oppressed to hoist them to power. This is a reflection of the fact that political consciousness has been thrown back, that socialist ideas have seemed less viable. But in the course of the huge struggles that are now inevitable, and which will put even the events in Ecuador, Bolivia and Venezuela in the shade, the working class can once again draw socialist conclusions.

Independent political action by the working class is now needed. This means building new working class parties that will fight for full democratic rights, for land reform, for nationalisation of the major banks and monopolies, for cancellation of the debt and for a socialist economic plan to eliminate poverty. This would inspire a movement of the working class that would quickly spread beyond national borders and place the idea of a socialist Latin America firmly on the agenda.

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