A quarterly magazine of urban affairs, published by the Manhattan Institute, edited by Brian C. Anderson.
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Events in Honduras and Argentina point to a continent weary of socialism.
1 July 2009
Last weekends ousting of Honduras president Manuel Zelaya, and the electoral defeat of former Argentinean president Nestor Kirchner in his bid for a seat in that nations Congress, may seem unrelated at first glance. But the Honduran military coup and the parliamentary victory of Argentinean pro-market parties are both signs of a profound evolution across Latin America. In 2003, the Kirchnershis wife Cristina is the current presidenthad joined a leftist revolutionary league led and financed by Venezuelas oil-rich dictator, Hugo Chavez. Joined in this same unholy alliance against the United States and economic globalization were Bolivia, Ecuador, and Nicaragua, the latter governed by the former Marxist Sandinistas.
Zelaya of Honduras was on his way to joining this group. The coup that deposed him was not of the usual variety: the military acted on an order of the Supreme Court, which had ruled illegal a referendum the president was pursuing that would change the Constitution and allow him to remain in office. He has been replaced with the president of the Honduran Congress. For now, Zelayas ouster has put a halt to Chavezs attempted ideological annexation of Honduras. Likewise, Argentinean voters have demonstrated that they are fed up with the Kirchners populist, anticapitalist rhetoric.
Hondurans and Argentineans understand that Chavezism is dividing Latin America into two antagonistic camps. One has chosen the path of free markets, privatization, free trade, the rule of law, and regular turnover of political leadership. Initially led by Chile, this group now includes Brazil, Colombia, Costa Rica, Guatemala, Mexico, Panama, and Santo Domingo. From the 1960s to the 1980s, these nations suffered greatly from poverty, civil war, military dictatorship, and the depredations of left-wing and right-wing guerrillas. Traditional oligarchies or revamped revolutionary nomenklaturas dominated the lives of the poor. After the Soviet Unions collapse in 1991, when Soviet and Cuban agents finally stopped manipulating events on the continent, many in Latin America began to see that stable democracy and free-market economics could eliminate civil wars and bring prosperity.
The pioneer was Chile, which restored democracy after the Pinochet era. And Chilean voters continue to elect nominally socialist presidents who are realistic enough to maintain the efficient, pro-market approach begun under Pinochet. Argentina under President Menem came next, in 1989. But Menemismo, a local imitation of Reaganomics, was disrupted by bad monetary management and excessive public deficits. After his 1995 election, Brazils Fernando Henrique Cardoso began dismantling a stifling state bureaucracy, and the nations economy took off. Cardosos nominally leftist successor, Ignacio Lula de Silva, has followed the same globalization strategy, with positive results: as growth trickles down to the poor in Brazil, as it did in Chile, social injustice has eased. In 2006, Peru turned in a free-market direction with the election of a former president (and former leftist), Alan Garcia. Other governments in the region, from conservative (Mexico) to socialist (Uruguay), now take for granted that free markets in the long run can cure the continents age-old woes: poverty, inequality, social unrest, and ethnic confrontation.
As former Brazilian president Cardoso puts it: They are now two Latin Americas, one which is still mired in the obsolete populist, revolutionary rhetoric and the other which has joined the modern world. The Hondurans and the Argentineans have now chosen to leave the old Latin America behind. For Chavez and his newly displaced cronies (he subsidized Zelaya and the Kirchners), this looks like the end of the party. Unexpectedly, it comes in the midst of an economic downturn: one would think that in a time of crisis, many in Latin America would reject capitalism. On the contrary, the economic crisis seems to favor conservative parties. Earlier this year, the Conservatives in Brazil won the local elections against Lulas leftist Workers Party.
The recent European elections revealed a similar right-leaning trend: only Greece rejected the Conservative parties for the Socialists. Latin Americans and Europeans seem to have decided that in difficult times, there is no room left for populist rhetoric: free-market advocates look like the better managers to bring the economy out of its current slump.
When evaluating the political upheavals and social movements in Latin America, however, one should not rely solely on Eurocentric categories. The revolutionary Chavez, for instance, cannot be understood entirely through Western European concepts like left or right, revolutionary or conservative. Many Latin American populist leaders also play the ethnic card. Chavez is popular among mixed-blood Venezuelans, who feeljustifiablylong oppressed by the white bourgeoisie. Evo Moraless leadership in Bolivia is perceived by many Indians as the revenge of their race against the centuries-long domination of the white elite. Still, one must also recognize that the economic failure of Chavezism in Venezuela, Bolivia, Ecuador, and Nicaragua has demonstrated that the exploitation of ethnic resentment, as with class resentment, is not the way to a better future.
Latin America has long been described as the continent of magical realism by Gabriel Garcia Marquez, among others. Fidel Castro, Hugo Chavez, Juan Peron, the Shining Path, the Sandinistas, and others have tried to play the magicians role. It worked, at least politically, so long as the people remained uneducated and ignorant. Today, while education remains a hurdle for many Latin Americans, greater numbers have become educated and informed. Global media and the power of migration have shown them the world as it really is. When given the choice, from Tegucigalpa to Buenos Aires, the people have opted for realism, without the magic. Economic opportunity through free markets may not be as seductive as ideological fantasy, but it is more reliable.
Guy Sorman, a City Journal contributing editor, is the author of numerous books, including the forthcoming Economics Does Not Lie.