Latin America: March forward or do an about-face

By Weekly Archive On Jun 30, 2007

By Eduardo Dimas

At times I have trouble believing that Latin America's bourgeoisies and oligarchies don't understand we're living through a period of change. Or — maybe they do understand it but have become used to quashing those processes through force and deceit, because it's not the first time a situation like this has occurred, although never to this extent.

By Eduardo Dimas

Maybe they expect the government of the United States (from which they depend to a large degree) to crush the progressive governments that promote change, as occurred on previous occasions. In Bolivia, for example, there are strong rumors about a coup d'état, rumors that have been denied by the Army's commander in chief. A coup attempt already occurred — against Chávez — and even Lula and Tabaré Vázquez have been the targets of threats.

There's a little of everything. But the truth is that Latin America's oligarchies and bourgeoisies are doing everything in their power to maintain the status quo that benefits their interests and the transnationals', without realizing that the structural deformities of the Latin American economies (which have existed since colonial times) limit their own possibilities for enrichment.

If the people of Latin America could consume more — without squandering their resources — they would be the principal beneficiaries. To do this, it is necessary to change the economic structures and seek true development, not the economic growth that solves nothing and perpetuates an unfair distribution of wealth.

Is it too much to ask them to understand that, while this situation is maintained, their interests will be in danger and that they cannot resolve that contradiction by force?

Sometimes I think that Hugo Chávez was ahead of his time when he spoke of "21st Century socialism," an economic model whose structure no one has described, although the state will play a basic role in controlling the productive infrastructure and the basic resources, something that will not please the transnationals. A model that will seek the development of the national economy, not its growth.

And, above all, a model that will allow for a more equitable distribution of wealth, so the people may live honorable and full lives. In other words, a model that will seek more social justice.

What is evident is that it won't be like the badly-called "real socialism," a bureaucratized and dysfunctional form of socialism that died a natural death in Europe, that is the subject of more-or-less successful reforms in China and Vietnam (reforms with a social cost, of course), and that is being studied in Cuba with an eye to future changes, once world political circumstances (among them an end to the blockade) permit them. Repeating the same mistakes would be absurd.

Despite the opposition from the United States and its allies, despite the incomprehension of the national bourgeoisies — and even though the changes are more nationalist than socialist — the people of Latin America are taking steps to contribute substantially to a development of the economy. Particularly if greater integration and complementation can be achieved; if — as the more progressive governments propose — the nations go beyond simple commercial relations.

By the time this issue of Progreso Weekly appears on the Internet, in Asunción, Paraguay, the Presidential Summit of the Common Market of the South (Mercosur) will be establishing the Bank of the South, after heated negotiations to bring everyone into an accord.

That will not be an easy task, because the creation of a bank with those characteristics, intended to solve the financial problems of member nations, implies a discussion about the way decisions should be made.

According to the press, on June 13, representatives of Argentina, Bolivia, Brazil, Ecuador, Paraguay and Venezuela adopted the accord during a technical meeting that included Chile, as an observer. The press reported that a common opinion was reached on the constitution of the Bank of the South and the project of its Founding Charter.

Later, a meeting of ministers of the economy took up the document, engaging in more discussion. The Uruguayan government announced it would study its participation in the new bank. The Founding Charter defines the Bank of the South as an institution under international law whose purpose is to finance the economic and social development of the 12 countries that form the Union of Southern Nations (UNASUR).

According to the approved document, each member of the Bank of the South will contribute the same amount of capital and will have equal representation. This might seem fair but isn't, because the signatories have different levels of development and income. However, the rule was a way to keep differences in the contributions from granting greater weight to some countries in the bank's decisions.

According to Brazilian economist Theotonio Dos Santos, many Latin American countries at this time hold sizeable reserves in international (mostly U.S.) banks that could be used for the development of Latin America instead of paying for military and luxury expenditures.

Brazil's reserves total $106 billion; Argentina's, $35 billion; Venezuela's, $34 billion; Chile's, $19 billion; and Colombia's, $16 billion. Dos Santos points out (and with reason) that if the countries stopped maintaining their reserves in dollars and stopped paying interests to the United States, "we'd see a decisive turn in the world's economy."

For his part, La Jornada journalist José Steinsleger, in an article titled "The money is there; the ideals are not," states: "The Bank of the South, started by some American countries, could be the road to a change that will permit governments to invest their reserves in research and development, to buy high-technology machinery, to reduce poverty effectively, to generate decent jobs, and to create a modern infrastructure in our countries."

However, the Brazilian economist Dos Santos says, "the principal limitation is the mental and moral narrowness of our ruling classes. It is a lot easier to receive a salary from the multinational corporations — particularly from international banks — than to struggle toward a fundamental change in our reality."

I think both men are right, and what they say is a reflection of the attitude assumed by the bourgeoisies and oligarchies in Venezuela, Bolivia and now in Ecuador. And, to a lesser degree, in Brazil and Uruguay. It is not by whim that the United States is promoting all kinds of pressure against the first three nations, while the Center-Democrat International (Christian Democrats) and the Christian Democrat Organization for America (ODCA) led by José María Aznar have made those countries — along with Cuba — the principal objectives of their policies for Latin America. It is no coincidence.

So, unless the presidents agree otherwise, the Bank of the South will be born with one limitation: the amount of capital in its vaults will be limited to the amount of money contributed by the poorest and least-developed countries, i.e., Bolivia, Ecuador and Paraguay.

It is said the Bank of the South's initial fund will total about $7 billion, so each founding member will have to contribute a little less than $1.2 billion. To some, it's not much money; to others, it's too much. Wouldn't it be better if each country were to contribute according to its possibilities and waived its right to a proportional influence in the Bank's decisions?

That would be a step toward the integration and complementation of the economies and a true help to the nations with smaller incomes. That seems to be President Hugo Chávez's intent, but, according to some sources, it is not the wish of the governments of Argentina and Brazil, who have a greater opportunity to contribute money to the Bank.

It is evident that the Bank of the South is born handicapped by that situation, which is a faithful reflection of the contradictiones experienced by the process of Latin American integration and of the multiple pressures of all types exerted on the Latin American leaders, especially pressures from the Empire and the local oligarchies. It remains to be seen what will be decided at the Mercosur Summit.

I think you will agree with me that the creation of this Bank is an important step in the process of Latin American integration. It's a pity that it's not more ambitious. To march forward and break schemes and interests is always harder than doing an about-face. Let us hope the process will become increasingly more irreversible and that it won't be just another failure in the history of Latin American peoples.

Editor's Note: At the closing of this issue of Progreso Weekly, several communications media announced that the founding of the Bank of the South was postponed until July, because of Uruguay's entry and the heavy agenda of the Mercosur Summit.