Latin America From Independence to the 20th Century

1
Latin America From Independence to the 20th
Century

• Poli332
• Maxwell A. Cameron
• Department of Political Science

2
Aftermath of Independence

• Most Latin American nations experienced a long
  period of instability in the 19th Century.
• Politics was often dominated by strong-men, or
  caudillos.
• After 1850s, economic upturn occurred based on
  demand from Europe and North America.

3
Export-Import Growth, 1880s-1930 - A Liberal Era

• Primary products for European markets
• Import of manufactured goods
• Foreign investment
• Stimulus for development from outside internal
  entrepreneurship weak.
• European migration encouraged
• End of the era of caudillos, rise of oligarchic
  states

4
Crisis of Oligarchic States (1900-1930s)

• Early industrialization, growth and incorporation
  of the working class by parties or the state.
• Rise of middle sectors
• Crisis of oligarchic states, rise of reformist
  movements
• Depression and WWII paradoxical effect on Latin
  America

5
Import-Substitution Industrialization (1930-1960)

• Rise of ISI following depression, collapse of
  export markets
• Growth of industrial bourgeoisie and labor
• Wave of military coups, efforts to coopt labor.
  Collapse of oligarchic states.
• Expansion of the state and consolidation of
  populist alliances (examples Peronism,
  Cardenas).
• Rise of CEPAL, dependency theory

6
Horizontal ISI Protecting a Domestic Market
Market open to imports
Expansion of domestic industry
7
Crisis of ISI, 1960s-1970s

• ISI had numerous problems
• Structurally incomplete reliance on capital
  goods. The need for deepening.
• Limits of domestic demand (small markets).
• Technological requirements labor absorption
  low. Creation of labor aristocracies.
• Infant industries never grow up inefficient
  industrial plant.
• Yet Latin America does not follow Asian route
  shift form ISI to export-oriented
  industrialization.
• Dependency critique

8
Political Crises and Coups

• Brazil 1964 coup
• Argentina 1966, 1976 coups
• Chile 1973 - Pinochet coup
• Uruguay 1974 - coup
• Novel attributes shocking levels of repression
  coups occur in modernized (urbanized, educated,
  economically advanced) countries regimes
  professional and institutional.

9
ODonnell Suggests New Theory

• More industrially advanced countries (Brazil,
  Argentina, Chile, Uruguay, Mexico) all highly
  repressive authoritarian states
• Medium level of development pacted democracies
  (Colombia and Venezuela)
• Least developed personalist regimes or military
  rulers, some democracies (eg. other Andes).
  Oligarchies and autocracies (Central America).

10
Classifying Latin America - II

• Advanced Countries
• Southern Cone, Brazil, Mexico (BA states)
• Medium developers
• Venezuela, Colombia (democratic)
• Least developed
• Other Andes, Central America, Caribbean
  (non-democratic)

11
Latin Americas Unique Trajectory of Development
Level of industrial development
Level of Democracy
modernization
12
BA regimes

• Crisis of ISI seen to be linked to the rise of
  bureaucratic authoritarian regimes
• Coup-coalition created by perception of threat
• Anti-political, technocratic and bureaucratic
  character near elimination of political
  activity.
• Exclusion of the working class and popular
  sectors. Efforts to deactivate labor.
• Effort to revive growth through transnational
  alliances (with TNCs, reliance on bank lending)

13
Assessment of BA State Theory

• Illusion of one-to-one links between economic and
  political change.
• Key concepts that remain an important part of
  regime analysis in contemporary Latin America
• levels of threat connection with the degree of
  repression
• exclusion/incorporation
• technocratic roles and offices
• BA literature also changed our thinking about the
  classification of cases.
• Did not anticipate next phase democratization
  and debt

14
Debt Began with Heavy Borrowing in 1970s

• Recycling of petro-dollars
• Seemingly strong governments in Latin America
  promoting industrialization
• Idea of sovereign debt

15
Caught in a Pincer Debt Crisis

• Commodity (especially oil) prices fell
• Interest rates rose
• Mexican default in August 1982
• An aggravating factor capital flight

16
IMF Washington Consensus

• Stabilization
• Monetary policy
• Exchange rate policy
• Fiscal policy
• Structural adjustment
• Open markets (free trade)
• Encourage private investment
• Reduce public sector (deregulation, privatization)

17
The Lost Decade

• 1970s
• World 2.68
• Latin America 3.46
• 1961-2000
• World 2.76
• Latin America 1.78
• E. Asia 4.96

• 1980s
• World 2.29
• Latin America -0.82
• E. Asia 5.8

18
Debt Coincided with Democratization

• Authoritarian coup coalitions collapsed
• Military not a good manager
• Business opposition
• Pressures from below led to liberalization
• Human rights protest
• Commitment to elections
• New democratic leaders

19
Incomplete, pacted democracies

• Pacts
• Military vetos (enclaves)
• Limits on scope for policy reform
• Continuing power of technocrats

20
The Neoliberal Record

• Too much portfolio hot capital
• Persistence of poverty inequality
• Low growth (1.75 in 1990s)
• Low employment growth

• Inflation tamed
• Fiscal discipline achieved
• Balance of payments restored
• Inflow of capital

21
End of 1990s

• Mixed results of market reforms (neoliberalism)
• Incomplete democracy
• Rising dissatisfaction with economic and
  political performance of governments
• Changes in the international system (end of Cold
  War, 9/11)

22
Current Era Left Turns (1998 - )

• Shift to the left
• With macroeconomic stability
• Social spending, emphasis on poverty
• Renegotiation of external relations
• Mobilization of indigenous and unorganized
  sectors a new incorporation phase?
• Re-founding of republics, constitutional reforms,
  attempts to encourage broader popular
  participation