Latin America’s new ‘left’ governments

Issue: 107

Claudio Katz

This is a slightly edited version of an article by one of Argentina’s best known Marxist economists circulated internationally in Spanish earlier this year. Its original title was ‘The centre left, nationalism and socialism’.1 It was written before the most recent upheavals in Ecuador and Bolivia. This translation is by Mike Gonzalez. Footnotes have been added where we thought it helpful; endnotes are Katz’s own._

The new governments of Latin America share a critique of neo-liberalism, rampant privatisation, an excessive openness of economies to global capital and of social inequality. They propose to erect more productive and autonomous capitalist forms under greater regulation by the state. But will they form a common bloc and will they offer the people access to power?

h2. The failures of neo-liberalism

Lula came to power in Brazil and Kirchner in Argentina because neo-liberal policies could not reverse the decline in Latin America’s role in the world market, a decline shown by the stagnation of investment and per capita GDP, and which contrasted notably with what was happening in China and South East Asia.

Cycles of growth continued to depend on the flows of foreign capital and the price of exports – that is why capitalist profits lacked stability in the 1990s. A falling wage bill did not compensate for the shrinking internal market, and a decline in purchasing power affected capital accumulation. The opening of their economies emphasised the disadvantages of Latin American businesses vis à vis their competitors. Many capitalists profited from the growing public debt, but the failure to control it hampered the ability of governments to intervene with tax policies to protect them from the periods of recession.

Neo-liberalism did not reduce social struggle, and the ruling classes were not able to achieve the kinds of victories they had won in previous decades; on the contrary, they have had to face risings which have brought down several presidents in the Andean region and the southern cone. Direct action on the land (Peru), an indigenous rising (Ecuador), pressure from the street (Argentina), an insurrectionary climate (Bolivia), land occupations (Brazil), anti-imperialist protests (Chile), a new political movement (Uruguay) and the resistance to military coups (Venezuela) have inspired a new cycle of resistance throughout the region.

The ruling classes have lost the confidence they displayed in the 1990s and many of their principal representatives have withdrawn from the scene (Menem in Argentina, Fujimori in Peru, Salinas in Mexico, Pérez in Venezuela, Lozada in Bolivia). A decade of embezzlement of public funds confirmed the corruption of all regimes that mediate with big capital.

h2. Characteristic behaviour

With Lula and Kirchner the political framework that the ruling classes have controlled for decades has begun to change. The businessmen and bankers who profited from deregulation have now jumped on the interventionist bandwagon. The sectors worst affected by the disasters of the 1990s are especially keen to enjoy the benefits of state subsidies and to put limits on the interventions of foreign competition.

The dominant alliance of financiers, industrialists and agro-export companies which controls the system of power is not the same as the classical national bourgeoisie of the 1960s. They have strengthened their integration into the international financial circuits (as receivers of credit and debtors to the state), they have consolidated their role in exports at the expense of the internal markets, and they have major investments abroad. Yet this increasing transnationalisation has not destroyed their local roots. By maintaining their principal activities within the region, the ruling classes of Latin America remain a distinct sector in competition with the corporations based outside the region. They are the principal support of the new governments and are behind their increasingly conservative direction.

Lula and Kirchner avoid populist rhetoric and avoid any conflict with the US State Department because they share interests with the region’s major capitalists. This caution explains why they are prepared to negotiate with the World Trade Organisation and the various ‘light’ versions of the Free Trade Area of the Americas, and why they have avoided building any real customs union. They implement fiscal reforms, accept funds from the IMF and refuse to consider any joint organisation of debtor nations.

The new presidents have refused to participate in the imperialist occupation of Iraq – but then very few world leaders have supported Bush in his crusade. But they have sent troops to Haiti, allowing the Pentagon to free some of its troops based in the Caribbean for the war in the Arab world. Lula, Kirchner and Tabaré have colluded with the formation of a puppet government which has legitimised the coup against Aristide, regulated drug trafficking and restricted the high levels of emigration to Miami. The fact that Latin American military personnel are wearing UN insignia does not change the fact that they are serving US interests.

The role of the centre left governments has been to soften the resistance movements in the region. That was the role of Lula and Kirchner’s envoys during the Bolivian debacle of 2003, for example, when they intervened in the middle of a popular rising to support the establishment of a government that would continue the policies of its predecessor and guarantee the privatisation of oil. Other presidents with progressive credentials have played the same role without need of outside intervention. Gutierrez in Ecuador, for example, promised national independence and instead governed through repression and continued to privatise.

h2. Brazil and Argentina

The new presidents emerged in different conditions. Lula assumed the presidency in the final phase of an economic crisis which accentuated Brazil’s urban inequality and rural poverty. Kirchner came to power at the end of the deepest depression in Argentina’s history, which had brought the collapse of the banking system, the confiscation of bank deposits and unprecedented levels of poverty, hunger and unemployment.

Lula has won plaudits from Wall Street for maintaining his predecessor Fernando Henrique Cardoso’s neo-liberal model. His arguments are the same (‘we must win the confidence of the market in order to attract investment’) and serve only to strengthen the role of the financiers who run the Central Bank. He has also protected the profits of the banks with a budget surplus of 4.5 percent of GDP and the highest interest rate of recent decades. These methods ensure that creditors will continue to receive repayments that amount to double the level of public spending.

Kirchner avoided this kind of continuity because he was obliged to rebuild the ill-fated circuit of accumulation and so adopted more heterodox policies to restore capitalist profits. He took advantage of an upturn in the economic cycle to combine tax changes with a range of subsidies and re-established the balance between the groups who gained during the period when the Argentinian peso was convertible into one US dollar (bankers and privatisers) and those who lost out (exporters and industrialists).

Both governments defend profits against the interests of workers. The Brazilian president has already imposed a regressive pension reform, frozen agrarian reform and reinforced the fall in the value of wages. His party holds back trade union struggles and has succeeded in holding down the level of popular resistance. Kirchner, on the other hand, is facing a more complex social situation because he came to power amid a popular rising. He has tried to defuse protest through co-optation (giving government jobs to activists), by wearing down the most combative sectors through constant media attacks, and by criminalising many of them – there are dozens of prisoners and thousands facing trial. And he has succeeded in diluting the impact of the picket lines and the cacerolazos,^a^ although mass mobilisations continue to be the backdrop of Argentinian political life. His administration is conservative, but he is much more careful than his Brazilian colleague to hide his links with the neo-liberal past.

While Lula’s rise to power occurred without major institutional fractures, Kirchner reached the presidency unexpectedly after a turbulent sequence of temporary governments. What in Brazil was a calm transfer of power, in Argentina was a delicate operation to restore the credibility of the state in the face of mass rejection of the political system (expressed in the slogan ‘que se vayan todos’ – get rid of the lot of them).

Lula marks the final phase of the transformation of the PT^b^ into a classic bourgeois party, breaking with its left wing past and becoming integrated into a bipartisan system. Its patronage finances an army of bureaucrats who upheld the expulsion of those members of parliament opposed to the pension reforms.
This transformation of a popular movement into an appendage of capitalist domination was what happened with Peronism^c^ a long time ago. Kirchner was able to renew yet again the party that has guaranteed governability for the ruling class. But he has shown an uncharacteristic duplicity, veiling clientilism with gestures in defence of human rights, the independence of the judiciary and an attack on corruption.

h2. Uruguay and Bolivia

The case of Uruguay is similar to Argentina’s in terms of the degree of economic breakdown, but closer to Brazil with respect to a lower level of social struggle and the greater stability of the political system.

Although the GDP and investment levels fell dramatically, the crisis never took on Argentinian dimensions in Uruguay. The Frente Amplio (Broad Front)^d^ managed to maintain institutional continuity and to avoid political breakdown or a vacuum. Now its ministers are rushing to implement Lula’s orthodox economic orientation. They have promised to pay the debt, introduced a regressive tax system, and they continue to offer a bankers’ paradise and sustain the enormous budget surplus that is required to avoid defaulting on debt.

This development can be explained in part by a weakening of resistance through unemployment, emigration and the ageing of the population. But the historical traditions of a country which has never experienced popular uprisings or significant breaks in institutional structures also have an influence.

The Frente Amplio’s official line is that ‘a small country cannot act alone’, as if progressive policies were the exclusive province of big countries. But this discourse justifies inaction and will conflict with the expectations awoken by the coalition’s electoral victory. The social base, the cultural hegemony and the mass organisations of the Frente sit uneasily with the spurious political realism of its leadership.

In Bolivia the centre left (Evo Morales^e^) is not in government but has supported the unstable presidency of Mesa^f^ and is working to replace him in 2007. But this timeline does not square with the breakdown in the regions or the uneasy administration of a ruling class that has neither resources, political tools nor mediating institutions to help it deal with the crisis.

The displacement of the nation’s productive axis from the mines of the east to the oil fields of the west has only served to deepen the economic crisis. If the closure of the mines raised the level of unemployment, the attempt to stop coca cultivation sowed devastation among the peasantry. This impoverishment accentuated the tendency to disintegration of the country, which the business sector of Santa Cruz was happy to intensify in order to appropriate petroleum income. Its ambitions clashed with the popular demand that brought down the Lozada government in 2003 – the nationalisation of natural gas so that it could be used for industrialisation.

In Bolivia there is a vibrant tradition of popular uprisings. That is why Mesa used a fraudulent plebiscite to mask the continuing privatisation of the energy industry behind promises of nationalisation. The support of Evo Morales allowed him to suggest he was moving towards state ownership when in fact he was planning to continue with private contracts for many decades yet.

If they are to govern like Lula the centre left will have to deactivate popular resistance and win the confidence of the ruling class at the same time. The moderate policies and acceptable candidates coming from the MAS suggest that this is their objective. But the territorial integrity of Bolivia is also threatened by a tendency to balkanisation which coexists with the always latent possibility of a new popular insurrection. In these circumstances, it is unlikely that the demobilising formula applied elsewhere in the southern cone can function in Bolivia.

h2. Venezuela: the Bolivarian process

Does Chávez belong to this centre left current? The international press regularly distinguishes his ‘populism’ from the other ‘modernising governments’; and there are indeed significant differences between Lula and Kirchner and Chávez.

Chávez did not maintain the institutional structures as Lula did, nor did he oversee the rebuilding of the traditional parties like Kirchner. He emerged from a popular rising (the ‘Caracazo’ of 1989) and a military rebellion (in 1992) which led to a major electoral victory in 1998. He began by making social concessions and introducing a very progressive constitution. His government has radicalised alongside the mass movement and in response to the conspiracies of the right. This dynamic distinguishes him from the other centre left governments because he acted against the bosses (in December 2001), the attempted coup (April 2002), the oil establishment (December 2002) and the challenge of the referendum of August 2004. And there are many other features that distinguish the Venezuelan process.

Chávez displaced the traditional parties of the ruling class which lost their control of the state. His base is the mass movement and there is no sector of the capitalist class who see him as a potential ally. He does not just promise reforms but has initiated genuine land redistribution programmes, extended credit to co-operatives and provided health and education for the whole population. Chávez stands, therefore, in the nationalist tradition of Cárdenas in Mexico, Peron, Torrijos of Panama and Velasco Alvarado in Peru. And this makes him an exception among the centre left responses to imperialism.

The explanation probably lies in the peculiarities of a Venezuelan army which had little contact with the Pentagon but was influenced by the guerrilla tradition, and in the weight of the oil-producing sector with its powerful bureaucracy, its conflicts with its customers in the US and the limited role of private enterprise. But Chávez’s anti-imperialism places him at the opposite end of the spectrum from any dictatorship – Chávez has much in common with Peron, but nothing at all with Videla.^g^ He shares with the Peron of the 1950s, for example, his social programmes and the redirection of national income towards welfare services. He enjoys the same kind of social support, though if Peron’s base was the organised working class. Chávez’s support comes from the local organisations of casual workers.

Chávez is different from his South American colleagues, too, in his confrontation with the right. He has scored some victories, but as long as their privileges are under threat, they will not cease to conspire to remove Chávez or to force him into a conservative turn (of the kind taken by the PRI^h^ in Mexico).

The US pulls the strings of any coup attempt or terrorist provocation from Colombia, but Washington has no Pinochet to turn to and has to rely on its ‘friends in the Organisation of American States’ to undermine Chávez. Bush cannot act in too barefaced a way while he is stuck in the Middle East quagmire. He does not dare to compare Chávez to Saddam – and Chávez cannot be tamed like Gaddafi. The US needs Venezuelan oil and it needs to combat Venezuela’s active involvement in OPEC and its attempts to redirect crude oil to new clients in China and Latin America.

Chávez supplies oil to Cuba and maintains diplomatic relations with Havana, defying the embargo, which further aggravates the tensions with imperialism. Venezuela sent no troops to Haiti nor will it bend to Washington’s demands on trade; and the presence of Cuban doctors and teachers has made Venezuelans very sensitive to the issue. Chávez’s understanding of Bolivarianism is sympathetic to socialism.

The country is divided into two camps by income, culture and skin colour. The oligarchy’s reaction to the presence of the marginalised in the political process is to manipulate the middle classes, and there are almost daily confrontations. Chávez, on the other hand, has shown great skill in mobilising his supporters against the manipulations of the right wing media. There is much in common between the Venezuelan situation and Nicaragua in the 1980s or Portugal after the revolution of 1974.

Its oil income has allowed Venezuela to raise its public spending from 24 percent of GDP in 1999 to 34 percent in 2004 and to address the external debt without major difficulties. These special circumstances explain the vitality of the Bolivarian revolution compared with other regional centre left governments, but they also raise questions as to how far its experience can be generalised.

h2. A regional bloc?

Chávez’s proposals for regional integration met a lukewarm reception from his centre left colleagues, none of whom expressed any readiness to replace the Free Trade Areas of the Americas with Chávez’s proposed ALBA (Bolivarian Alternative for the Americas). They echoed his rhetoric, but showed little will to build anti-imperialist regional organisations. Chávez has proposed three: Petrosur, bringing the oil companies into a single entity; Bansur, a regional bank bringing together national reserves; and a common market (from Mercosur^j^ to Comersur).

In some senses, these associations would embrace businesses that already link a number of capitalist enterprises. On the other hand, these agreements will not produce the autonomous integration Chávez is hoping for. That would require social transformations that no centre left government is willing to carry through. For Petrosur to control the region’s oil production, for example, would require the renationalisation of oil in Argentina and Bolivia – it would make no sense to link this organism with foreign private oil companies. In any event both Kirchner and Mesa have forged strategic alliances with Repsol to maintain privatisation. The creation of Enarsa (the Argentinian state energy company), with neither resources nor wells of its own, can contribute nothing to integration, any more than the fact that Brazil’s Petrobras has bought the shares of an Argentinian corporation (Perez Companc) or that the Venezuela National Oil Corporation has united with Enarsa in acquiring service stations. None of these moves challenges the exploitative character of oil production in the region. Petrosur could expose the profits of some providers but it will not be able to guarantee the energy provision that would make it possible for new industries to develop in the interests of the majority.

The reserves for a regional bank do exist, but are controlled by the IMF. For Bansur to come into being would require first the creation of a debtors’ club capable of resisting the IMF’s interventions and putting an end to the haemorrhage of funds from the area – and no government in the region is proposing any such thing.

Any attempt to achieve major agreements on trade face the counterpressure of bilateral agreements encouraged by the US which are favoured by Latin America’s ruling classes, who trade more with the metropolis than with their neighbours. Mercosur’s difficulties reflect this tension: its customs agreements, for example, contain 800 exceptions. And while 50 percent of European Union exports are between member countries, in Mercosur that figure is only 11 percent. Brazil certainly does not perform an economic role like Germany, nor is Argentina France’s political equivalent.

Integration is vital to counter the tendencies to fragmentation already visible in Bolivia and Ecuador, for example. But the region’s capitalists have other priorities; it is not true that ‘the national bourgeoisies that have survived neo-liberalism are drawn towards the formation of a common bloc’.2 On the contrary, transnationalisation has reduced their interest in integration – hence their hostility to Chávez. The presidential summits issue rhetorical calls to forge a South American Community, but do little practical about it.

Transnational firms, on the other hand, have prospered and they are actively behind moves to ease capital movements in order to cheapen labour, rationalise subsidies and maximise the gains from tariff reductions. But this kind of integration is of no benefit to the people. So Chávez’s attempt to spread the Bolivarian spirit has come up against a structural obstacle. No official argument or mass mobilisation has been able to leap this hurdle. While capitalists retain their power the dream of Bolivar and San Martin cannot be fulfilled.

h2. Governments in conflict?

Some analysts have argued that the process of integration will advance through the integration of nationalism and the centre left, on the assumption that Lula and Kirchner will later move to the left.3 And this opens the second area of debate – can the governments of the centre left bring the people closer to power?

It is a common view that both governments are ‘in conflict’ – but the clashes with business interests which are normal in any capitalist government are not to be confused with the involvement of popular forces in these conflicts. And they certainly play no role in the clashes between bankers and industrialists that have divided Lula’s team nor with the arguments over subsidies that have split Kirchner’s cabinet. These clashes arise from capitalism’s competitive nature itself. And it is particularly revealing in the case of Lula, who has opted to follow in the footsteps of Blair and Felipe Gonzalez (the former Socialist Party prime minister of Spain) in the absence of any pressure from the right. His working class origins have not held him back from this orientation, and his continuation of previous policies cannot be attributed to ‘what he has inherited’ nor to the fact that he is leading a government of transition. Some people argue that it is a tactical move on Lula’s part because he has not yet conquered power. That would be credible if he showed any signs of opposing the ruling class; control of the state could be a step towards effective control of the economy if he had any intention of transforming the status quo. But today Lula is a close ally of the same capitalist groups that are behind Kirchner.

h2. Unreal options

Obviously Lula is not Cardoso and Kirchner is not Menem – but that only tells us that each new government adapts to the changing needs of the capitalist class. Both governments have strengthened the mechanism of state control – but for whose benefit? The neo-liberals used the state to carry through privatisations and rescue bankrupt banks. Lula’s interventions serve to block wage rises, guarantee high interest rates and channel the benefits of economic revival into the pockets of the agro-exporters. This does not contradict the notion of an independent foreign policy, because every Brazilian government has tried to diversify its trade and China today is in the sights of every entrepreneur.

But he introduced the Fame Zero (Zero Hunger) policy at least, some will say, to eliminate hunger; yet the programme never had adequate resources and never got off the ground. Despite the agrarian reform, landowners are still threatening those who occupy land, and while 27,000 oligarchs still control over half of Brazil’s land, the promised agricultural settlements are advancing at a snail’s pace. Even the modest economic recovery of recent times cannot be ascribed to Lula, since every country in the region is experiencing something similar, the result of foreign investments. The resurgence of the Argentinian economy is often attributed to Kirchner – some even say there are signs of a redistribution of income, though there is no evidence for this. If deepening poverty has been halted in this new cycle, it is worth recalling that the same thing happened in the early 1990s. What is really significant about the recent period is how little unemployment and social exclusion figures have fallen, given the tax surpluses that the government has found to pay off the debt.

Lula’s supporters are still hoping that he will ‘go back to his roots’, and Lula is happy to encourage people to think that way. Kirchner’s defenders say much the same thing, but the more secure he is the more he will impose the bosses’ model, just as he did during his governorship of Santa Cruz province. And the vigorous advocacy of Mercosur by both presidents is not the sign of change their supporters might have hoped for; in fact they are solely concerned with defending capitalist interests in both countries and protecting the private interests that might be harmed by closer cooperation between Brazil and Argentina. They have no plans to transform Mercosur into a project for integration from below and resisting imperialism.

h2. Contradictions on the right

Some still argue that a defeat for Lula ‘would let in the right’ – but the reality is that, unlike Venezuela, there is no sign that the right in Brazil have any desire to destabilise Lula. Others affirm that compromise with the IMF and the right is the only way of ensuring reform – but since Lula has adopted the programme of his opponents, those reforms are no longer on the agenda. Lula has changed sides, and the working class now needs to develop its own alternative.

The spectre of the right is also used in Argentina, even though the capitalist class has much to be grateful to Kirchner for.

Some writers4 have argued the need to form a common front with the government against the right, using Mao’s distinction between primary and secondary contradictions as a rationale. But the issue here is not one of socialist strategy. Kirchner is not leading a national bourgeoisie in a conflict with imperialism nor is he involved in a conflict which could lead to an insoluble crisis for capitalism. And even if that were so, it would be wrong to abandon popular demands; pacts with the class enemy can only lead to a disarming of the oppressed and the kind of internal divisions that will destroy the revolutionary project. Addressing only the ‘secondary contradictions’ simply serves to break the link between minimum and maximum demands and frustrate the development of social struggles.

There are those who argue that the PT has not lost its identity under Lula. But a party that serves the interests of the bankers, while it may preserve an electoral base, can no longer claim to represent the working class. Lula made compromises with neo-liberalism, promoted regressive labour legislation and buried any mention of socialism in the PT’s manifestos to ease its alliances with the right. Power has undermined the PT’s origins in struggle, just as it did with Peron in Argentina many years earlier.

The ‘lesser evil’ argument leads to a series of subsequent capitulations. Lula’s open collusion with the right is more obvious than Kirchner’s development; yet he too has set out to demobilise the mass movement and ensure the dominance of capital.

But however these governments are characterised, there can be no justification for militants or activists to participate in either of them;5 to be part of the government is to collude directly in the application of policies directed against the mass movement. There is no possibility of representing the people inside a cabinet dominated by the interests of capital, as the history of 20th century social democracy has clearly shown. Progressive ministers end up masking the realities – that is why Lula and Kirchner have appointed well-known figures to the ministries of justice, culture and human rights, leaving political and economic questions in the hands of the establishment.

h2. Comparative justifications

Some Brazilian intellectuals have argued that the lack of the level of struggle that could place socialism on the agenda explains Lula’s move to the right. In Argentina the suggestion is that Kirchner is a moderate because the movement did not exist in the first place. In both cases, commentators hypnotised by power have expressed no anger at the sufferings of the people. Instead there is talk of an unfavourable balance of forces – yet there is no mention of the fact that both governments have actively demobilised the movement, reinforcing the trade union bureaucracy through the CUT in Brazil and the Peronists in Argentina. Any reduction in the levels of struggle, therefore, is not an objective fact but the result of government policies. Any discussion of a balance of forces assumes that both presidents have remained within the camp of the oppressed, whereas in fact both have placed themselves firmly alongside business in opposing social reforms.

In these circumstances there can be no defence of Lula or Kirchner. Some argue that this is not the moment to discuss alternatives – when will the moment then be right? We need not await any further signs than the turn that the PT has taken. The danger now is not a premature break, but the effect of growing popular disillusionment. The fatalists in Argentina affirm, ‘What do you expect? – Kirchner is a capitalist.’ In that case, there is only one conclusion: we should resist government assaults, expose its manoeuvres and build a left alternative. Neither is Uruguay’s Frente Amplio a model to imitate: it has just entered government and is already following Lula’s path, and the argument that it was an organisation built from below is contradicted by its many years of adaptation to the institutions of capitalism.

h2. Venezuela’s dilemma

In Venezuela, by contrast, there does exist a ‘government in conflict’; the major struggles in which Chávez is involved bring face to face capitalist interests and those of the masses. Any attempts by business groups to curry favour with Chávez fall foul of this constant confrontation, which in its turn has created a radical anti-imperialist dynamic.

Venezuela has the same levels of inequality and underdevelopment as the rest of the continent: 80 percent of the population lives in poverty and three quarters of the population work in the informal sector of the economy. Any resolution of these problems must begin by going beyond the limits which frustrated all previous attempts at independent national development. Social welfare policies, the distribution of unproductive land and credits to co-operatives can initiate a gradual redistribution of wealth. But it will take massive state investment to reverse the structural unemployment and deepening inequality of recent years. This demands a programme of industrial planning that will eradicate the privileges of the big capitalists and their allies in the bureaucracy. The people who pilfered the national oil wealth will not now become agents of development.

The sacking of the management of the state oil company was a major step forward; the increased level of royalties and the reduction of dependence on the US market (50 percent of exports and eight refineries on US territory) increase the level of economic independence. But there is still manipulation, exploration rights given without permission, and suspect investments to be dealt with. All Chavez’s ambitious social reforms require a radicalisation of the process, while Kirchner, Lula (and the new Spanish prime minister Zapatero) are all working to encourage him to build bridges with the opposition—echoing the position of the Organisaton of American States, Jimmy Carter and Human Rights Watch.

Yet the main block on this process lies within the Chavez government itself, dominated as it is by an inept and opportunist bureaucracy which will happily change sides should the wind change direction. One section of Chavez’s supporters (the Comando Ayacucho) brought that moment nearer by validating the collection of fraudulent signatures for the referendum.
All this tells us that victories that are frozen get diluted, that a blocked Bolivarian revolution could easily follow the road of Mexico’s PRI and become an instrument of the ruling class. The Cuban Revolution followed the opposite path—and while Chavez has often expressed his admiration for Cuba he has not set in motion any break with capitalism as the Cubans did in the 1960s.
The institutions of the Venezuelan state are undergoing a process of democratic radicalisation—although the system has not collapsed as it did in Nicaragua, the possibility of a revolutionary turn is there. It is a mistake to imagine that nothing is happening in Venezuela, and that a populist Chavez will not lead a social revolution. The formation of new trade unions and the growing self-organisation of the missions and the Bolivarian circles suggests that a radical change is already under way.
Globalisation and unipolarity
While it is widely recognised that the climate has changed in Latin America, it is often argued that globalisation has forced the left to retrench.6 And it is important to discuss the impact of the information revolution, financial globalisation and the internationalisation of production on the region. The reality is that the process that allowed a partial recovery of profit rates in some developed countries has also had a brutal polarising effect. Latin America has suffered deepening impoverishment, deeapitahsation and an increasing dependence on primary exports. The question is, can it recover the level of independence that would enable it to reverse that regressive process?
The theorists of the centre left insist that the solution is a model of regionally integrated capitalist production. But this project addresses only those niches that exist for opening up new businesses, without discussing the distortions that global accumulation has produced on the periphery— and neither do they acknowledge that no Latin American capitalism will be able to compete with the imperialist metropolises or reproduce their historical development.
In any event it is difficult to imagine the space in which such a model could operate, given that its implementation would require anti-imperialist measures and a radical break with neo-liberalism. Since no existing government is prepared to do that, it is difficult to know where this ‘alternative capitalism’ can develop. The new presidents all began with anti-liberal declarations then moved to support the status quo. The only certain route to progress, then, is a radical anti-capitalism with a socialist perspective.
But does the awful power of US imperialism not make any such option an impossibility7? This power is not new of course; every 20th century national independence movement has had to confront it and on several occasions hasbrought the enemy to its knees. The very existence after 40 years of the-Cuban Revolution is testimony to that. The US has certainly built up its military potential and recovered its economic dominance in the last decade; but its leadership is unstable and it is facing resistance. Iraq bears witness to the limits of American power. The expansion of Bush’s preventive wars is deeplv disturbing—but that does not mean that we should accept neo-conservative triumphalism. US aggression is producing both financial and political crises which challenge its global dominance.

The USSR and the balance of world forces

There is a general impression that the fall of Eastern Europe removed an important ally of the left—but in fact it only supported those governments and movements that reflected its strategic interests. The Cuban leadership was fiercely critical in this respect. Latin America was always a pawn in the USSR’s diplomacy. So the end of the Cold War had contradictory, and not always negative, effects on the region. If it left the left feeling disarmed on the one hand, on the other it removed the identification in the popular mind of socialism with totalitarian regimes.

This analysis suggests that we move our gaze from what is happening ‘above’ (between states) to what is going on ‘below’ (in the mass movements and class consciousness). That is the basis on which to make an assessment of the balance of class forces. The other perspective can only lead us back to the search for an ‘anti-imperialist camp’ whose membership is unclear—is it Europe, China, the Arab world?

The key question is who is on the offensive in the struggle between workers and capitalists? In general, the initiative has been with the ruling class since the advent of neo-liberalism. But a great deal of water has flowed under the bridge since the 1980s. In many countries there have been popular risings—and here Latin America is in the vanguard. You cannot suggest that the balance of forces is against the popular movement while saying at the same time that the new centre left governments are the products of advances in the mass movement.

Hostile forces, internal and external

It is true that an anti-imperialist victory cannot be limited to one country— though Cuba has shown that it is possible to survive under conditions of imperialist siege. Every revolution has occurred in unfavourable conditions and has begun within a single country before transforming the wider scene by its example. In Central America several countries were involved, though never simultaneously; and though this was a problem it was internal conditions which became the main block, as the Sandinistas’ experience proved. Imperialist aggression was a major factor, but what undermined the project was the transformation of the Sandinista leadership into a new wealth elite which negotiated power-sharing with the right. Twenty five years after this revolution, there remains not a trace of the agrarian reforms or literacy programmes in a country torn apart by poverty and inequality almost equalling the tragedy of Haiti.

Does this mean that the socialist project is no longer viable? Is the centre left project all that we can aspire to? The popular risings in Bolivia, Ecuador and elsewhere give the lie to that, testifying to the readiness of many to develop a radical anti-imperialist solution to Latin Americas poverty and degradation. The main obstacles to the growth of that possibility are not found in the international context but in the errors (and betrayals) within the struggle itself.

The popular classes take to the streets and confront the system—but the initiative passes back to the enemy whenever they have to define the future political direction of their country. The centre left governments that accompany the demonstrations in the streets and then betray them in the presidential palaces are the clearest example of this paradox.

The turn to the local

Asserting that the revolutionary cycle has ended leads first to support for Lula and Kirchner and then to a strategy for local activity which privileges the municipal level. Some people suggest that a prefigurative participatory democracy can be built here even if the bourgeois order prevents its establishment at the national level. This idea informed many of the activities of the PT and the Frente Amplio prior to their winning government. Yet in the case of the PT it was a precursor to their absorption into the establishment—and their recent electoral defeats in Porto Alegre and Sao Paulo demonstrate that the citizens will take only so much frustration before they punish them like any other party.
None of this invalidates activity- at the local level—indeed it can be an important contribution to the building of a left alternative. The mistake is to imagine that what cannot be built nationally can happen in one municipality, all the more so when local areas are starved of resources and suffering the effects of public spending cuts and regressive taxation, as is the case in most of Latin America. And above all, it is private property which represents the biggest barrier to change.
The PT introduced the practice of’participatory budgets’ in several places, encouraging notions ot local self-government. But these experiments were never linked to any struggles against the ruling class—and quickly became an exercise in administering poverty; and they did nothing to stop Lula’s drift to the right. For years the municipal reformism practised in Europe transformed fighters into functionaries and dissolved the militant energies of a whole generation. The arguments used then are the same as those used now—gradual reform from within, building consensus, avoiding confrontation and so on.
But this gradualist approach, and the hope of reforms, always foundered on two rocks: first, that accumulation is a crisis-ridden process that does not offer long periods of calm in which to implement this strategy, and secondly, that the crisis drives capitalists to resist social concessions. And in these circumstances the bourgeoisie always reclaims power, unless social democracy has been totally incorporated.

The current scene

As Lula and Kirchner approach the end of their terms they will still be feeing a turbulent and unequal region that is economically vulnerable and living in imperialism’s shadow. The loss of resources that is implied by debt repayment adds one more factor, because any financial disturbance will tend to produce capital flight. And the multinational corporations will persist in pressing meantime for more privatisation and lower tariffs.

The most explosive factor of all is the increasing militarisation of the continent under Bush’s presidency of the US—the public embrace of Bush and Colombia’s Uribe is ample evidence of the Pentagon’s continuing prominent role in Latin America. The new presidents may respond to imperialist pressures with fine rhetoric and clever manoeuvres, but the reality is that the context is determined by a rightward-moving US administration.

The hopes awoken by the election of Lula and Kirchner remain alive to a greater or lesser extent among the population—and these persistent illusions will have an effect on the strategies of the left. But to recognise popular expectations is one thing; encouraging them quite another. It is and always has been the left’s duty to speak the truth however much it hurts, and that includes addressing Castro’s and Chavez’s support for the centre left presidents. In any event the support is not mutual: Lula and Kirchner have remained silent on events in Venezuela, because neither wants to provoke the enmity of the State Department, while Chavez and Castro support them in order to avoid isolation and to counter imperialist propaganda. But diplomacy does not require a political support which is counterproductive as far as the movement in Brazil and Argentina is concerned. The left should have learned not to adapt its activities to the foreign policy requirements of states; the defence of the Soviet Union produced far too many capitulations for us to repeat them now.

The Latin American left needs now to reaffirm that its field of action is in struggle with the oppressed not in discussing their concerns with the business sector. What matters is not what kind of capitalism we would prefer—be it ‘capitalism with a human face’ or ‘the creation of a society with opportunities for all’—but how to develop a socialist project. The left will have no future unless it marches under the banner of equality and freedom. Today many young people are joining the movement and expressing admiration for the revolutionary legacy of past generations. But they also see how some of those who came from that past have joined the establishment and conceded victory to the powerful. If we are to recover the legacy of the 1970s we will need courage, determination and a deep conviction.


I: ‘Centroizquierda, Nacionalismo y Socialismo . available on the author’s web page
2: See M Rolando, ‘Bolivarismo revolu-cionario y unidad suramericana , Question, September 2004.
3: Representatives of this view include, in Brazil: F Betto, Ahora Lula conquistar el poder”, Pagina 12, 20 September 2004; P Valter, ‘La gauche a l’heure du choix , Inprecor 4-97, September 2004.; M Pont and R Rosseto, ‘Ideias’, Agencia Carta Mayor, 3 May 2O04; E Sader. ‘Brasil y Lula desde un enfoque de izquierda’, Propuesta, TOjune 2004= Articulacao de Esquerda e Democracia Socialista, ‘Carta aos Petistas’, Democracia Socialista, no Cj-January-February 2 005; Editorial’. Correio da ciuadania; ‘Un nouveaux parti socialiste’, Inprecor 497-September 2004- In Argentina: H Tumini. En marcha, 14 October 2O04; IRudnik ‘^Quien confronta con el FMI?\ Desde los barrios, 12 December 2004. In Uruguay: E F Huidobro, O estamos fritos’, Pagina 12, 25 January 2005.
4: H Tumini, as above.
5: As has happened in Brazil with the DS (Democracia Socialista) current and in Argentina with Barrios de Pie’.
6: These issues are discussed for example in M Harnecker. La izquierda lati-noamericana y la construccion de alternatives’. Laberinto no 6, June 2001. and ‘Sobre la estrategia de la izquierda en America Latina , Venezuela: Una revolu-cion sui generis , Conac, Caracas, 2004.J Petras, ‘ Imperialism o y resist encia en Latinoamerica’. S Ellner, ‘La situacion actual en America Latina’. Los intelec-tuales y la glohahsacion (Abya-Yala, Quito. 2004)- Leftist goals and debate in Latin America , Science and Society, vol 68. no I (spring 2004).