[stop-imf] Neoliberal Policies Big Loser in Bolivian Elections

[Robert Weissman]

Neoliberal Policies Big Loser in Bolivian Electionsby 
Jimmy Langman 
July 5, 2002
http://www.americaspolicy.org/articles/2002/0207bolivia.html


This past Sunday, Bolivians went to the polls to choose their next 
president and elect a new Congress. In the balloting for president,
nobody 
earned the "50 percent plus one" margin required for an outright
electoral 
victory, and so Boliva's new congress now gets to decide which of the
two 
top vote-getters will be the nation's next leader. Congress's decision
is 
expected at the beginning of August.The lack of a decisive winner was 
grounded in widespread disenchantment with the traditional political 
parties, and is emblematic of the growing sense of frustration with 
Bolivia's neoliberal economic model.Indeed, the most distinguishing
aspect 
of this year's elections in Bolivia was that virtually all the
candidates 
lashed out to attack neoliberal strategies.After seventeen years of 
neoliberalism, Bolivia's economy is faltering, unemployment is on the
rise, 
the rich-poor gap has widened, and corruption and social exclusion
remain 
serious problems.Candidates of all political stripes--including the 
right--tapped into anger over the failings of neoliberalism and made 
opposition to it central to their discourse.Manfred Reyes Villa, whose
New 
Republican Force party is considered center-right--and who as four-time 
former mayor of Bolivia's third-largest city Cochabamba embraced 
controversial privatization schemes--shrewdly calculated that his
populist 
agenda could not stand up otherwise in a nation in which the vast
majority 
live in poverty.Reyes Villa, who will face former president Gonzalo
Sanchez 
de Lozada in the August 14 congressional run-off, said in a televised 
public debate one week before the June 30 vote: "The people are tired.
We 
need to leave the neoliberal model in the past and focus on building a 
productive model."Jaime Paz Zamora, the leftist former president 
(1989-1993) who is known as a moderate for his codifying into law many
of 
market reforms, went a step further and said in a campaign debate that
his 
Movement of the Revolutionary Left party would now not participate in
any 
coalition government that purported to maintain the neoliberal model.Paz 
Zamora proposed major changes to the nation's constitution to address 
social and economic problems. "There are a few who are satisfied with 
Bolivia's constitution and economic model, but the immense majority want
to 
change it," he explained.Introduced to the country in 1985 under
pressure 
from the International Monetary Fund (IMF) in exchange for partial
relief 
of the Bolivia's crushing foreign debt, the neoliberal model includes 
opening up markets, lowering government spending, and privatization. But 
Bolivians are angry over the results.The economic growth rate in South 
America's poorest country last year was just 0.5 percent.About 65
percent 
of all Bolivians live below the poverty line, and in the countryside, 
greater than 90 percent.Nearly 12 percent of urban Bolivians are
officially 
out of work (accurate figures for rural unemployment don't exist, but
are 
estimated to be many times higher). Many of those who do work only earn
the 
nation's low monthly minimum wage of sixty-seven dollars. Close to 66 
percent of Bolivians are estimated to work in the informal economy and
do 
not draw regular salaries, shining shoes or selling produce and other
wares 
in street markets.For Bolivia's indigenous communities, who make up more 
than 70 percent of the 8.3 million national population, poverty and
jobless 
rates are much higher still.Even with partial debt relief in exchange
for 
market reforms, Bolivia currently owes $4.37 billion to international 
lenders, well more than half its annual gross national product of $7 
billion. Last year, the government received $312 million in fresh loans, 
but paid back $250 million to international lenders. In other words,
about 
80 percent of new loan monies went right back to lenders to pay on
interest 
and part of the capital of old debts.Bolivia, which experienced a
military 
coup or counter-coup on average at least once per year over the first
162 
years of its history, has experienced unwavering political stability
since 
1982. But Jorge Lazarte, a Bolivian political analyst, says that while
the 
nation has indeed built strong institutions over the past two decades,
the 
next few years could put the nation to a stiff test."No matter who wins
the 
election, it will be a weak government because the many opposition
parties 
will cause problems," predicts Lazarte. "If the next president does not
get 
social and economic problems under control within the next three years,
the 
nation could fall like Argentina."Gonzalo Sanchez de Lozada, popularly 
known as "Goni," played a key role in implementing market reforms in
tandem 
with the IMF and World Bank as president of the country from 1993-97. He 
narrowly earned the largest share of votes on April 30, and analysts say
it 
looks probable that he will win the run-off vote against Reyes Villa and 
begin a five-year term of office on August 6.But in a recent interview, 
even Goni denied that he supports neoliberalism. "I don't believe in 
neoliberalism, I believe in an open market economy.""But I am not 
dogmatic," he said. "And if you see many of my reforms they had very 
important social consequences. But I think you need to have a market 
economy, which also requires a great deal of government intervention,
this 
stuff about the invisible hand, it just doesn't work that way."The
surprise 
in the election, however, was Evo Morales. The longtime leader of
Bolivian 
coca leaf farmers finished a close third out of the eleven candidates in 
the presidential race. His Movement Toward Socialism (MAS) party also 
garnered the second-highest amount of seats in Bolivia's Congress.Prior
to 
election day, the U.S. ambassador to Bolivia, Manuel Rocha, warned that
if 
Morales were elected, or his Socialists included in a coalition
government, 
Washington would close its markets to Bolivian textiles and natural 
gas--comments that were roundly denounced by politicians from all of 
Bolivia's numerous parties.Morales, though, said his anti-neoliberal
model 
stance, not coca eradication, was his number one agenda item. He calls
for 
a repeal of the 1985 government decree 21060, which initiated many of
the 
neoliberal reforms in the country, and the renationalization of many of 
Bolivia's privatized state companies.Last week, Morales responded to 
Ambassador Rocha's declarations saying: "The ambassador's threats don't 
make us afraid. The people are rising up against the system and the 
model."Morales added that he is not pro-cocaine, but pro-coca. "Coca has 
been part of our diet and traditions in Bolivia for many hundreds of
years. 
Coca is not the same as cocaine."Alvaro Garcia, a Bolivian political 
analyst, said that the strong showing by Morales and his MAS party is
the 
beginning of an authentic opposition movement to the neoliberal
model."It's 
clear from election results that more than 50 percent voted for a
change. 
After 17 years of the model, social movements are no longer bystanders
to 
the political process," said Garcia."The next government is going to 
confront an opposition that will make it very difficult for them to 
implement their policies," he said. "That will either lead to 
authoritarianism, or a social pact with social movements."Jimmy Langman
is 
a journalist based in Santiago, Chile. A frequent visitor to Bolivia, he 
covers Latin America for a number of publications.Join our network to 
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are posted to the Americas Program website. Information on our privacy 
policy is available on our network sign-up page.Published by the
Americas 
Program at the Interhemispheric Resource Center (IRC). ©2002. All rights 
reserved.Recommended citation:
Jimmy Langman, "Neoliberal Policies Big Loser in Bolivian Elections," 
Americas Program (Silver City, NM: Interhemispheric Resource Center,
July 
5, 2002).Web location:
http://www.americaspolicy.org/articles/2002/0207bolivia.html