Latin American And East Asian Regional Development
By Noam Chomsky
26 December, 2006
There was a meeting on the weekend
of December 9-10 in Cochabamba in Bolivia of major South American leaders.
It was a very important meeting. One index of its importance is that
it was unreported, virtually unreported apart from the wire services.
So every editor knew about it. Since I suspect you didn't read that
wire service report, I'll read a few things from it to indicate why
it was so important.
The South American leaders
agreed to create a high-level commission to study the idea of forming
a continent-wide community similar to the European Union. This is the
presidents and envoys of major nations, and there was the two-day summit
of what's called the South American Community of Nations, hosted by
Evo Morales in Cochabamba, the president of Bolivia. The leaders agreed
to form a study group to look at the possibility of creating a continent-wide
union and even a South American parliament. The result, according to
the AP report, left fiery Venezuelan President Hugo Chavez, long an
agitator for the region, taking a greater role on the world stage, pleased,
but impatient. It goes on to say that the discussion over South American
unity will continue later this month, when MERCOSUR, the South American
trading bloc, has its regular meeting that will include leaders from
Brazil, Argentina, Venezuela, Paraguay and Uruguay.
There is one -- has been
one point of hostility in South America. That's Peru, Venezuela. But
the article points out that Chavez and Peruvian President Alan Garcia
took advantage of the summit to bury the hatchet, after having exchanged
insults earlier in the year. And that is the only real conflict in South
America at this time. So that seems to have been smoothed over.
The new Ecuadorian President
Rafael Correa proposed a land and river trade route linking the Brazilian
Amazon Rainforest to Ecuador's Pacific Coast, suggesting that for South
America, it could be kind of like an alternative to the Panama Canal.
Chavez and Morales celebrated
a new joint project, the gas separation plant in Bolivia's gas-rich
region. It's a joint venture with Petrovesa (PDVSA, Petroleos de Venezuela,
SA. Pronounced "pedevesa"), the Venezuelan oil company, and
the Bolivian state energy company. And it continues. Venezuela is the
only Latin American member of OPEC and has by far the largest proven
oil reserves outside the Middle East, by some measures maybe even comparable
to Saudi Arabia.
There were also contributions,
constructive, interesting contributions by Lula da Silva, Brazil's president,
Michelle Bachelet of Chile, and others. All of this is extremely important.
This is the first time since
the Spanish conquests, 500 years, that there have been real moves toward
integration in South America. The countries have been very separated
from one another. And integration is going to be a prerequisite for
authentic independence. There have been attempts at independence, but
they've been crushed, often very violently, partly because of lack of
regional support. Because there was very little regional cooperation,
they could be picked off one by one.
That's what has happened
since the 1960s. The Kennedy administration orchestrated a coup in Brazil.
It was the first of a series of falling dominoes. Neo-Nazi-style national
security states spread across the hemisphere. Chile was one of them.
Then there were Reagan's terrorist wars in the 1980s, which devastated
Central America and the Caribbean. It was the worst plague of repression
in the history of Latin America since the original conquests.
But integration lays the
basis for potential independence, and that's of extreme significance.
Latin America's colonial history -- Spain, Europe, the United States
-- not only divided countries from one another, it also left a sharp
internal division within the countries, every one, between a very wealthy
small elite and a huge mass of impoverished people. The correlation
to race is fairly close. Typically, the rich elite was white, European,
westernized; and the poor mass of the population was indigenous, Indian,
black, intermingled, and so on. It's a fairly close correlation, and
it continues right to the present.
The white, mostly white,
elites -- who ran the countries -- were not integrated with, had very
few relations with, the other countries of the region. They were Western-oriented.
You can see that in all sorts of ways. That's where the capital was
exported. That's where the second homes were, where the children went
to university, where their cultural connections were. And they had very
little responsibility in their own societies. So there's a very sharp
You can see the pattern in
imports. Imports are overwhelmingly luxury goods. Development, such
as it was, was mostly foreign. Latin America was much more open to foreign
investment than, say, East Asia. It's part of the reason for their radically
different paths of development in the last couple of decades.
And, of course, the elite
elements were strongly sympathetic to the neoliberal programs of the
last 25 years, which enriched them -- destroyed the countries, but enriched
them. Latin America, more than any region in the world, outside of southern
Africa, adhered rigorously to the so-called Washington Consensus, what's
called outside the United States the neoliberal programs of roughly
the past 25 or 30 years. And where they were rigorously applied, almost
without exception, they led to disaster. Very striking correlation.
Sharp reduction in rates of growth, other macroeconomic indices, all
the social effects that go along with that.
Actually, the comparison
to East Asia is very striking. Latin America is potentially a much richer
area. I mean, a century ago, it was taken for granted that Brazil would
be what was called the "Colossus of the South," comparable
to the Colossus of the North. Haiti, now one of the poorest countries
in the world, was the richest colony in the world, a source of much
of France's wealth, now devastated, first by France, then by the United
States. And Venezuela -- enormous wealth -- was taken over by the United
States around 1920, right at the beginning of the oil age, It had been
a British dependency, but Woodrow Wilson kicked the British out, recognizing
that control of oil was going to be important, and supported a vicious
dictator. From that point, more or less, it goes on until the present.
So the resources and the potential were always there. Very rich.
In contrast, East Asia had
almost no resources, but they followed a different developmental path.
In Latin America, imports were luxury goods for the rich. In East Asia,
they were capital goods for development. They had state-coordinated
development programs. They disregarded the Washington Consensus almost
totally. Capital controls, controls on export of capital, pretty egalitarian
societies -- authoritarian, sometimes, pretty harsh -- but educational
programs, health programs, and so on. In fact, they followed pretty
much the developmental paths of the currently wealthy countries, which
are radically different from the rules that are being imposed on the
And that goes way back in
history. You go back to the 17th century, when the commercial and industrial
centers of the world were China and India. Life expectancy in Japan
was greater than in Europe. Europe was kind of a barbarian outpost,
but it had advantages, mainly in savagery. It conquered the world, imposed
something like the neoliberal rules on the conquered regions, and for
itself, adopted very high protectionism, a lot of state intervention
and so on. So Europe developed.
The United States, as a typical
case, had the highest tariffs in the world, most protectionist country
in the world during the period of its great development. In fact, as
late as 1950, when the United States literally had half the world's
wealth, its tariffs were higher than the Latin American countries today,
which are being ordered to reduce them.
Massive state intervention
in the economy. Economists don't talk about it much, but the current
economy in the United States relies very heavily on the state sector.
That's where you get your computers and the internet and your airplane
traffic and transit of goods, container ships and so on, almost entirely
comes out of the state sector, including pharmaceuticals, management
techniques, and so on. I won't go on into that, but it's a strong correlation
right through history. Those are the methods of development.
The neoliberal methods created
the third world, and in the past 30 years, they have led to disasters
in Latin America and southern Africa, the places that most rigorously
adhered to them. But there was growth and development in East Asia,
which disregarded them, following instead pretty much the model of the
currently rich countries.
Well, there's a chance that
that will begin to change. There are finally efforts inside South America
-- unfortunately not in Central America, which has just been pretty
much devastated by the terror of the '80s particularly. But in South
America, from Venezuela to Argentina, it's, I think, the most exciting
place in the world. After 500 years, there's a beginning of efforts
to overcome these overwhelming problems. The integration that's taking
place is one example.
There are efforts of the
Indian population. The indigenous population is, for the first time
in hundreds of years, in some countries really beginning to take a very
active role in their own affairs. In Bolivia, they succeeded in taking
over the country, controlling their resources. It's also leading to
significant democratization, real democracy, in which the population
participates. So it takes a Bolivia -- it's the poorest country in South
America (Haiti is poorer in the hemisphere). It had a real democratic
election last year, of a kind that you can't imagine in the United States,
or in Europe, for that matter. There was mass popular participation,
and people knew what the issues were. The issues were crystal clear
and very important. And people didn't just participate on election day.
These are the things they had been struggling about for years. Actually,
Cochabamba is a symbol of it.
This is a lightly edited and excerpted version of Noam Chomsky's December
15, 2006 talk to a Boston meeting of Mass Global Action following a
recent trip to Chile and Peru.
Noam Chomsky's most recent
book is Perilous Power: The Middle East and U.S. Foreign Policy: Dialogues
on Terror, Democracy, War and Justice.
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