Monday, May 8, 2006

Mixed feelings for Bolivia’s nationalization plan

Bolivia’s move to nationalize their gas fields last week has alarmed several Latin American governments such as Brazil who receives more than half of their natural gas from Bolivia. As this National Public Radio piece shows, others are worried that Evo is turning towards a less pragmatic political left-wing.

Bloggers have also reacted to Bolivia’s nationalization plan by disagreeing over the supposed split in the Latin American left over the plan. Other reactions range from jubilation to restrained optimism to repudiation.

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5 comments:

Dr. Mathews said...

After commending the country for its "sound macroeconomic policies and substantial structural reforms, which has made it possible to lower inflation, strengthen the balance of payments, and attain real GDP growth of 4 percent a year during the 1990s" a Deputy Managing Director of the International Monetary Fund was forced to admit in mid-2001 that "poverty is still widespread." Bolivia ranked 113th in the list of 177 countries on the United Nation's 2003 Human Development Index. Its GDP per capital is $2,587, just under that of Georgia's, while life expectancy is 64.1 years, just under that for the Russian Federation. It seems reasonable that another approach be given the opportunity to succeed where the Washington Consensus obviously failed.

12:33 PM
Boli-Nica said...

^^^What new approach are they are going to try??? They are merely going to try to recreate the same centralized state-based solution that led to corruption and inefficiency.
--right now they raiding the pension system of Bolivia of its equity to re-launch a national oil company.

And they are angering Brazil

http://bolicarreras.blogspot.com/2006/05/bolivia-vs-brazil-viennanamecalling.html

12:33 PM
Dr. Mathews said...

You know, Boli-Nica? ... it ultimately is not my call nor is it your call. It is the call of the Bolivian electorate. If you are sincere with yourself, you will have to admit that we are witnessing something remarkable: Democracy in Action. If the outcome doesn't please us personally, then tough luck! If it doesn't please the Bolivians, then they will vote in someone else next time. It is in that spirit which I opined that it seemed reasonable that another approach be given the opportunity to succeed where the previous one (after many years) failed. The Bolivian electorate apparently thought so. Furthermore, I think that is the unequivocal message we are hearing all over Latin America, whether you or I like it or not. Perhaps you would like to see a return to military dictatorship?

Oh, ... and as a footnote to those who love to demonize President Chavez of Venezuela. I may not agree at all with his policies, but he is the democratically elected President of that country for better or for worse. What's more, he has done some things vastly more Democratic than any of his predecessors ever did.

9:59 PM
Boli-Nica said...

Jeez a Chavez apologist.... Dude is threatening to close all private TV stations, and whose cronies are robbing the State Petroleum Company blind, to the point where they are helping to fuel Miami's real estate boom.

Democracy and Jacobinism are two separate things.

Morales nationalization measures, were done by decree, going way beyond the Constitutional mandate, he has from the law approved by a majority of the Bolivian people in a referendum. He trusts his own party so little he does not bother submitting it as legislation.

Not only that, he raided the pensions of all Bolivians, without compensation, which is unconstitutional.

And as far as the Washington Consensus is concerned, following a course of action involving: a prudent monetary policy, following a fiscally responsible course for government, ridding states of inefficient companies and redundant bureaucracies, lifting restrictions on foreign capital, protecting property rights is nothing short of common sense.

None of that is incompatible with reasonable social policies targeted at improving the quality of life and investing in social capital. Or for that matter even expanding state structures in certain vital areas.

Where the "Consensus" failed was that countries ignored suggestions for improved and/or new regulatory structures on things such as capital inflows, and there was little transparency in privatizations in some places.

11:03 PM
Dr. Mathews said...

On Chavez, I restate my point: I may not agree at all with his policies, but he is the democratically elected President of that country for better or for worse. What's more, he has done some things vastly more Democratic than any of his predecessors ever did. That doesn't make me an apologist for Chavez, just a defender of democracy. Do you believe in democracy or just balancing a budget?

Secondly, you claim that: Where the "Consensus" failed was that countries ignored suggestions for improved and/or new regulatory structures on things such as capital inflows, and there was little transparency in privatizations in some places. Although you are partially right, what is wrong with the Washington Consensus extends beyond simply implementing new regulatory structures. I tend to agree with COHA Research Associates Teddy Chestnut and Anita Joseph:

If the IMF, instead of applying a formulaic, rigid Consensus to developing economies, acknowledged the unique social forces at work in Latin America, it would have more successfully realized its objectives.

8:35 AM

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