To help understanding Bolivia

It was not so long ago that one could sense that modernization was taking hold in Bolivia. The country seemed on a fast track  toward better economic times. With energy-thirsty neighbors like Brazil and Argentina natural gas was becoming the economic factotum. Investments poured by the hundreds of millions of dollars. The economy grew at a rate of 5% to 6% annually, which meant duplicating GNP in barely 12 to 15 years. Democracy appeared solid. Political parties, even former foes, formed alliances to ensure governability. Bolivians had learned, some said, to choose rulers by the ballot, no more by the bullets. In the second decade of the new millennium just around the corner, they said, this country would be different.

Wait. Let´s don´t go too fast. That was the official script. Underlying were sheer inequalities making not two but three Bolivias which at some point clashed and erupted in a hitherto dormant or even unconscious drive to engage in real progress.

James Dunkerley, one of the most lucid “Bolivianists”, shows us in his most recent book (Bolivia: Revolution and the Power of history in the present”. Institute for the Study of the Americas, University of London) the ways Bolivia has undertaken over the past few years through this dimming 2007.

It is tough to face a book so dense in events and details in one single comment. I will likely come back to talk about it again. Now I just want to mention the section that leads to present days.

“It is impossible to understand the period 2000-2006 without consideration of IMF pressure over the budget deficit, the international price of oil, or US pressure over coca. It is, moreover, very hard to imagine the initial months of the MAS taking the course they did without Cuban and Venezuelan support…,” states Dunkerly. It means that pressure over a fiscal discipline often ignored by rich countries aggravated Bolivian economic problems and paved the way for subsequent events whose magnitude only now can be relatively assessed.

One can not but agree with Dunkerley that most social conflicts are tightly related to the same issues (poverty, unemployment) that permeate the three Bolivias he refers to quoting Bolivian economist and professor at the San Simón University in Cochabamba Roberto Laserna in his book “La Democracia en el Ch´enko” (Democracy in the mess), published by Fundacion Milenio.

Identification of these three Bolivias is essential to begin understanding the country. “These are still negatively correlated with each other to produce an empate catastrofico (cathastrophic draw) … One quarter of the population lives in ‘modern Bolivia’, operates according to a mindset of instrumental rationality and can at least formulate universalist projects. However, this sector lacks the intellectual and material resources to realize these projects. As a result, it is culturally inclined to be adverse to risk and engage in rent-seeking behavior, its average household income is $491per month and a third of this sector is classified as poor. A second group, of around 35 percent of the population, operates within an informal economy of essentially family-based activity…Extremely vulnerable to market disruptions of cash-flow and social shocks to a favors-based system of rents, this sector can rarely accumulate capital and often devote its savings to conspicuous consumption in carnival-based activity derived from the provincial cultures to which it still belongs. It has an average monthly household income of $299 and half of its members live in poverty. Finally, there exist some 3.5 million people, 40 percent of the Bolivian population, within a ‘natural economy’ dominated by cultivation for subsistence…” It is from the poorest segments of these groups, or about two thirds of Bolivians, that Evo Morales won most of his support.

As the economy opened under Paz Estenssoro´s fourth presidency and his 1985 decree best known by its number 21060, economic activity in these segments unleashed. Jose Luis Roca, a historian and economist, told me that from a few dozen of shops and grocery stores back then the number multiplied exponentially to easily over a million businesses. Most are informal, not legally registered and barely yield taxes. “But this explosion was the great revolution for tens of thousands of peasants who before only wandered in El Alto”(Bolivia´s third largest city after Santa Cruz and La Paz). At 4,000 meters of altitude on the Andes plateau, “this city owes its own existence to them”, Roca said. It means El Alto was born out of the “neo-liberalism” that its inhabitants are said to hate. This rejection was the driving force behind the blockades and violent protests that overthrew market-friendly government of Gonzalo Sánchez de Lozada and his successor and former Vice-President Carlos Mesa, and ultimately ended up with the election of Evo Morales as the first Bolivian Aymara Indian President.

Quoted by Dunkerley, Laserna says: “It is clear that the stagnant sectors of the economy, which are composed by the natural and familiar economies, were and remain really successful in resisting the discipline and logic of the market. There are millions of campesinos and informal workers who used the market and at the same time block its expansion… this is the structural ch´enko” (mess). I would say it is like having the cake and not eating the cake.

Dunkerley´s work is rich for those, like myself, who have been out of Bolivia for many years. It is like taking an information landslide only to come out with a sharp sense of frustration. And hope. After all nobody faces such gargantuan adversities without a strong determination to win.

That frustration feeling recedes a bit as one reads a Dunkerley´s line at the end of the first chapter of the book: “…it must be noted that it was not until MAS came into office that any Bolivian government had a coherent policy, with real support from the office of the presidency to save 22,000 infants who die needlessly each year from malnutrition. Now, under “Desnutrición Cero” …this invisible tragedy is finally being confronted. Democracy may cost lives, but it saves them too.”

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