Rise of neo-liberalism in Latin America
Introduction
In her
influential article on the idea of plural neoliberalisms, Wendy Larner stated
that ‘Developments in the ‘periphery’ may be as significant, if not more so,
than those in the ‘core’ in explaining the spread of neoliberalism’. While this
applies to the Global South in general, Latin America’s experiences of the
realities of Neoliberalism are deep-rooted. Description of this influence of
neo-liberal thinking can be traced back to the early 1960s particularly in the
cases of Brazil and Colombia and Chile .
Rise of neo-liberalism in Latin America
There is
broad consensus that Chile constituted the first ‘neoliberal' experiment in the
world. Chile is a unique case in which a brutal military dictatorship paved the
way for the application of wholesale market reforms without any opposition
permitted. As pointed out by María Eugenia Romero Sotelo, corporate interests
and local ruling classes were on the frontline diffusing the economic and
intellectual ideas of the Neoliberals.
Rise of neo-liberalism in Latin America
Recent
literature has also emphasised the necessity of developing a decolonial Global
South based view of neoliberalism, one that debunks or at least relativizes the
predominant narrative which portrays neoliberal ideas and policies as
essentially European exports which travelled and landed with greater or lesser
degrees of success in Latin American lands What makes Latin American countries
an instructive case for observing the politics of neoliberalism What are the
specificities of the region What makes the Latin American trajectory towards neoliberalism
so paradigmatic There are at least four themes that can account for the
specificities of the neoliberal development in the region.
As I will
show in the next section, neoliberal reforms were initiated during the 1970s
and 1980s in most Latin American countries as a developmental strategy to
supersede the import substitution industralization model (ISI).
The ISI
model worked under the premise that economic modernization in the form of
industrialization would work as the foundation for the flourishing of
democratic institutions. However, as the Argentine political scientist
Guillermo O'Donnell famously pointed out, at the political level,
industrialization was followed not by democracy but rather by
authoritarian-bureaucratic states .
Rise of neo-liberalism in Latin America
O'Donnell
coined the term ‘bureaucratic-authoritarianism' to refer to a specific type of
state, arising first in Brazil (1964) and then in Argentina (1964, 1976), and
spreading to Chile (1973) and Uruguay (1973) under military rule. It was based
on a technocratic approach to policy, an exclusionary approach to the popular
sector, and a closed non-democratic political system.
Although
some authors see in the authoritarian-bureaucratic state the point of departure
of neoliberal reforms, others have stressed the discontinuities between a type
of state still oriented toward industrialization and a state which triggered
the reprimarization of national economies towards favouring the export sector .
Democratization, neoliberalization and the legacies of
authoritarianism
As I will
show in the next section, neoliberal reforms were initiated during the 1970s
and 1980s in most Latin American countries as a developmental strategy to
supersede the import substitution industralization model (ISI). The ISI model
worked under the premise that economic modernization in the form of
industrialization would work as the foundation for the flourishing of
democratic institutions (Collier & Cardoso, 1979). However, as the Argentine
political scientist Guillermo O'Donnell famously pointed out, at the political
level, industrialization was followed not by democracy but rather by
authoritarian-bureaucratic states (O'donnell, 1978). O'Donnell coined the term
‘bureaucratic-authoritarianism' to refer to a specific type of state, arising
first in Brazil (1964) and then in Argentina (1964, 1976), and spreading to
Chile (1973) and Uruguay (1973) under military rule. It was based on a
technocratic approach to policy, an exclusionary approach to the popular
sector, and a closed non-democratic political system. Although some authors see
in the authoritarian-bureaucratic state the point of departure of neoliberal
reforms (Cavarozzi, 1992), others have stressed the discontinuities between a type
of state still oriented toward industrialization and a state which triggered
the reprimarization of national economies towards favouring the export sector
(Schamis, 1991).
Rise of neo-liberalism in Latin America
By the late
80s, in an international context marked by the globalization of markets, nearly
all Latin American countries had to some degree adopted neoliberal reforms.
Even though the majority of neoliberal reforms programs were initiated under
democratically elected governments (Remmer, 1998), the origins of neoliberalism
in the region are closely attached to democratization, understood as the
transition from authoritarian to democratic rule, in international and regional
contexts marked by the oil crises and the debt crises respectively.
Consequently, what specifically characterises the development of neoliberalism
in the region is first the legacies of authoritarianism (including the so
called ‘authoritarian enclaves') (Garretón, 2004; O'Donnell et al., 2013) and
second, the type of democracies that these processes brought about in the
region, including the scarce redistribution of power and the extents of the
exclusion of the popular sectors (Schmitter, 2014).
The ‘persistence of inequality' and the coloniality of power
Divergent
from countries in the Global North, Latin American countries paths towards
development, indeed the very idea of development, have been strongly
conditioned by its colonial past and its relationship of dependence and
subordination with the core economies, as well as the structures of power
resulting from these asymmetries. While some approaches trace back persistent
inequalities in many areas of Latin America's social and political life to the
colonial period, suggesting the past explains, to a large extent, recent and
current economic disparities (De Ferranti et al., 2004), others have proposed a
more nuanced stand based around fined grained analysis of how land inequality
derived from the colonial haciendas and encomienda systems, fed specifically
into income and other asset inequalities (Frankema, 2009). Furthermore, other
approaches have emphasised the socio-cultural, economic and political contexts
in which those inequalities are reproduced, contained or reshaped, and of the
ways in which colonialism—considered as a matrix of power relations—operates at
interactional, institutional and structural levels (Quijano, 2007).
Rise of neo-liberalism in Latin America
The Peruvian
sociologist Anibal Quijano developed the concept of the coloniality of power to
account for the entangled ways in which relations of subordination and
discrimination initiated during colonial rule and has been subsequently
reproduced after colonial administration ended (Quijano, 2007, 2008). This
approach has undergone several reformulations which emphasise the continuities
of the racial, sexual, political and epistemic hierarchies of the colonial
past—based on the supposed superiority of European versus Non-Europeans—and on
the pertinence to present times (Grosfoguel, 2011; Lugones, 2007, 2016). The
entanglement between these structures of power and domination and Latin
American countries' uneven integration into the international division of
labour provides a distinctive context that has impacted in particular ways upon
the rise and subsequent developments of neoliberalism in the region.
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