Industrial policy

What went wrong with Latin America’s Left Regimes?

     Increasingly, right-leaning governments are replacing left regimes in Latin America or, if left governments continue to cling to power, they are adopting policies normally associated with the political right. There has been a shift back to some neoliberal policies that contributed to poverty and inequality in the past. Sympathetic observers placed great hope in the left regimes that came to power between the late 1990s and the mid-2000s—these regimes seemed to be on the right track since they reduced poverty substantially and made inroads into high levels of inequality. What went wrong?

The Latin American Left: Set for a Resurgence?

      Only very recently, observers of Latin American politics were proclaiming the decline of the populist left “pink tide, the various regimes that had come to dominate politics in many countries of the region through much of the 2000s. In 2015 and 2016, centre right leaders obtained a string of notable victories. Mauricio Macri was elected president in Argentina, the opposition in Venezuela obtained a landslide victory in congressional elections, Workers Party President of Brazil, Dilma Rousseff was removed from power through impeachment proceedings, and President Evo Morales of Bolivia lost a referendum to allow him a fourth term as president. However, recent events suggest that the left remains tenaciously resilient.

Technology and Decent Employment: Latin America and Beyond

     Lack of employment opportunities has been a longstanding feature of most Latin American countries, including Mexico, and one of the key reasons for historically high levels of poverty, deprivation, corruption, crime, and political violence. Lack of sufficient decent employment is now a widely recognized problem in the United States—one of the crucial issues in the election of Donald Trump was the loss of jobs, particularly in the manufacturing sector.

The TPP is Toast: This could be good news over the long term for Latin America.

    On Monday of last week, President-elect Donald Trump, outlining plans for his first 100 days in office, declared that he would withdraw the U.S. from the Trans-Pacific Partnership (TPP) trade deal and replace it with “fair” bilateral agreements. As the Japanese Prime Minister, Shinzo Abe, one of the 12 signatories to the deal, declared, the TPP “without the U.S, is meaningless.” The agreement aimed to lower barriers on trade and investment among twelve countries (bordering the Pacific Ocean: US, Japan, Malaysia, Vietnam, Singapore, Brunei, Australia, New Zealand, Canada, Mexico, Chile and Peru), accounting for approximately 60 percent of the world economy and 40 percent of the world’s population. 

The U.S. Election and the Future of the Latin American Left

    Regardless of who wins the U.S. election, a new era in the U.S. approach to international trade agreements is about to emerge. Donald Trump has railed against the North American Free Trade Agreement (NAFTA) as the worst trade agreement ever signed by the U.S. and promised to withdraw support for the Trans Pacific Partnership (TPP) if elected. Although not as strident, Clinton, in a reversal of her past pro free trade position, now says that she would renegotiate NAFTA and has come out in opposition to the TPP. Of course, rising opposition to economic globalization and trade integration is not confined to the U.S. as Brexit amply illustrates. We now face a critical moment in the history of global capitalism. 

Mexico, Trade, and the U.S. Election - Winners and Losers

    Mexico’s political and economic leaders are clearly terrified about the prospects of a Trump election victory. However, they should probably not be too sanguine about a Clinton victory either—although Presidential candidate Hillary Clinton has rejected the idea of a wall along the Mexican/U.S. border, she has gone on record as supporting “a barrier to prevent illegal immigrants from coming in” (1). She, like Republican presidential candidate Donald Trump, also supports the renegotiation of the North American Free Trade Agreement (NAFTA). To many observers it appears that Mexico has much to lose should the US abandon its enthusiasm for free trade agreements. It has, but the agreement has already been very costly for Mexico.   

The Venezuelan Crisis and the Failure of Petro Populism

    With the election of Hugo Chavez to the presidency of Venezuela in 1998, the country became the darling of the intellectual left. Chavez pledged to confront the country’s reactionary oligarchy and redistribute the bounty from the country’s petroleum wealth to eradicate poverty,  and deprivation. Until recently, supported by buoyant international petroleum prices, the “socialist” experiment seemed to work fairly well, although with intermittent and growing political tensions and increasing political polarization. Between 1999 and 2011, poverty and infant mortality rates declined. Today, however, the country faces a severe economic and humanitarian crisis involving inflation of over 700 percent, rising poverty, severe shortages in food and medical supplies, and burgeoning crime rates. Venezuela is now one of the world’s most violent countries.

Economic Exclusion and the Latin American Drug Wars: The Link between Neoliberalism and the Drug Trade

    On April 18, the United Nations General Assembly held a special session on the drug trade. At this session, Colombian President Juan Manuel Santos presented a plan for the complete and radical overhaul of global policy towards drug trafficking. Calling for an approach that is both more humane and comprehensive, he recommended an end to the victimization of drug users through abolishing the harsh penalties attached to drug related offenses. His views reflect growing support for a human rights approach to addressing the drug trade issue--one that recognizes that the punitive and repressive responses of states to drug production and trafficking have failed to reduce the trade while ratcheting up the level of drug related violence. The consequence has been that human rights violations related to drug offense are common throughout the region while Latin American prisons have become filled to overflowing with drug offenders, most of them consumers and low-level offenders. Altering the approach to the Latin American drug wars is essential to improving the human condition for millions who face both material deprivation and high levels of physical insecurity. In Mexico, for example, as many as 80,000 have perished in drug-related violence since 2006, while between 2012 and 2014, 2 million more fell into poverty. However, is taking a human rights approach to the drug issue, through decriminalizing lower level offenses, reducing sentences, and providing treatment for users, going to be enough to reduce the unfortunate social consequences that have arisen with drug production and trafficking?

Brazil: The Perils of Commodity Driven Inclusive Development

In this entry, Teichman discusses the Brazilian crisis, drawing on some of the ideas developed in The Politics of Inclusive Development. Policy, State Capacity and Coalition Building, 2016. (Link to publisher).

Brazil appears generously endowed with attributes that should contribute to the achievement of equitable and inclusive development: its ample agricultural land and mineral wealth affords a wide array of commodity exports while the country’s a large domestic market can support the development of industry and manufacturing. Nevertheless, Brazil’s historical development trajectory has been far from inclusionary, involving high levels of inequality, persisting poverty (reduced substantially only fairly recently), and exclusion. In the early 2000s, the World Bank identified the social exclusion of blacks, children, youth and indigenous people as one of the country’s most pressing development challenges (1). Brazil has had historically high levels of socioeconomic inequality, a feature sometimes linked to a dependence on commodity exports—one of the implications of the so-called resource curse. However, inequality and exclusion also arise from a history of highly unequal political power relations and the operation of exclusionary institutions.