Season of discontent in conquistadors' spoils

Hugo Chavez: Spokesman of the ills

Hugo Chavez the populist Venezuelan President has become the spokesman of the ills of Latin America by making strident remarks about the exploitation of his country's wealth by American conglomerates. The economic woes of Latin America are an unlikely event for a resource rich continent in terms of land and population ratio. It constitutes over half of the Americas covering an area of over 20,451,181 square kilometres and has a reasonably manageable population of approximately 0.52 billion people. Area wise Latin America constitutes 12 percent of the world area and population wise it constitutes 8.4 percent of the world population. Population density at 19.75 persons per square kilometre is one of the lowest in the world, although urban population around mega cities like Mexico City, Rio de Janeiro and Sau Paulo is one of the densest constituting two thirds of the total population.

Oil and gas, copper, timber and a host of agricultural and plantation produce make Latin American countries a major exporting region of the world. Brazil, the largest country of Latin America both in terms of area (8511965 square kilometre) and population (over 182 million), has per capita GDP of 8,100 US Dollar. Venezuela has a per capita GDP of 5,800 US Dollar, Mexico 9,600 US Dollar, Argentina 12,400 US Dollar, Chile 10,700 US Dollar and the poorest is Bolivia with a per capita GDP of 2,600 US Dollar. Judging by per capita GDP the countries of Latin American are in a state of sufficiency and prosperity in comparison to the impoverished people of Africa and to a greater extent the peoples of South Asia.

Nowhere in the world per capita GDP is so deceptive as in Latin American countries. Tucked away from the focus of international media the Latin American countries are home to surprisingly large number of impoverished and extremely poor people. It is painful that most of them are the decimated indigenous Aztec, Maya and other people, the mestizos or children of inter-racial interaction, and the colonial Hispanics. The malfeasance of so much unattended festering poverty right under the glitter of the fabulous wealth of the few is a tragic fact of Latin American countries. A look at few statistics will present the reality with all its glaring disparities. Out of today's Latin American population of 507 million 43.2 percent or 220 million live in poverty and close to 95 million (18%) are considered indigent. On top of that the richest 10 percent earn 48 percent of the total income and the poorest 10 percent earn only a meagre 1.6 percent of the total income. Discontent is therefore getting bolder in Latin American countries.

The phenomenon is visible in almost all the Latin American, particularly South American counties. Bolivia the poorest among the South American countries has the saddest story to tell. Out of its population of 8.8 million 70 to 80 percent live below the poverty line. The scenario is of utter misery and cruel deprivation. Two third of the poor live in dire poverty, two million Bolivians face chronic hunger and only 12 percent among them gets the minimum calorie intake. As for employment, 45 percent of the economically active population is believed to be unemployed. And most of these people are native Indian peasants living in the rugged Andean highland. Bolivia has the second largest gas reserve in South America and is seen as a possible flash point.

The ills of Bolivia started when the western educated outgoing President Sanchez de Losada started acting on the prescriptions of IMF on privatisation. He believed in the infallibility of economic solutions, thus incapable of perceiving the woe it will bring on the common man and oblivious of the dispossession his country would suffer, because he only saw the immediate gain. Losada's Bolivia encapsulates a typical case of a third world country succumbing to dispossession by accepting the logic of the Leviathan in immediate gain. This led Bolivia to a gas treaty, which allows it to keep only 18 percent of sales proceedings, even though the standard practice is 50 percent. It went to the extent of privatising water supply in an arid country leasing the source to a foreign conglomerate.

For Ecuador its oil resources became its bane, bringing environmental disaster to the forested equatorial region inhabited by the indigenous Indians. A unit of Texaco decimated the entire area, clearing forests, polluting waterways and leaving behind large reservoirs of toxic wastewater. The native Indians are in rage.

In Latin America the two successful economies were Argentina and Uruguay the end of the last century. Things however changed drastically in Argentina after the 2001 collapse. It landed Argentina in trouble with 55 percent of its population living in poverty and almost 38 percent in dire poverty. This is attributed to the ever-increasing profiteering hunger of market economy with little regard for the welfare of the common man. On the other hand Uruguay has relatively manageable socio-economic problem with 28 percent of its population living in poverty.

Brazil with a population of over 182 million, the largest in Latin America, along with Chile have the most unequal societies in South America. The poor or the favellas of Rio de Janeiro living in squalid poverty is a sharp contrast to the glittering opulence of the rich. More than 11.8 percent of its population live in dire poverty, which is a large number in terms of its large population.

A look at the poverty and the disparity of income of Latin American countries would not be complete without looking into Hugo Chavez's Venezuela. The free riding market economy of oil rich Venezuela in the eighties and in most part of the nineties brought it to the brink. The country fell into terrible economic crisis at the end of the eighties with massive flight of capital, compounded by falling oil prices and increasing interest rates. A country dependent on oil export had no option but to borrow more money for pumping the economy. Rafael Caldera, the predecessor to Chavez, was the president and he had to cave in to bitter prescriptions of the international lending agencies in undertaking massive privatisation, restructuring, deregulations and other stiff and uncaring conditions. More than one third of its population fell into poverty. What followed was run away inflation, soaring prices, labour unrest, unemployment and poverty.

The season of discontent was a perfect setting for populist Hugo Chavez to come to power. He inherited a beleaguered economy. Firmness along with the good fortune of soaring oil price helped in stabilising the Venezuelan economy. It was the flight of capital he targeted first. Venezuelans were restricted to spending not more than US Dollar 2,000 in a year during foreign trip. Royalty tax on foreign oil companies was increased from 1 percent to 16 percent. He kept on accelerating oil production. There was a strong backlash with the oil executives of Petroleos de Venezuela PDVSA enforcing a 48-hour total shut down which cost Venezuela US Dollar 8 billion. There was a three-day failed coup in April 2002 engineered by the business organisations, Fedcameras and Consicommercio.

Hugo Chavez is talking of Bolivarian self-dependence after Simon Bolivar, the South American hero who won independence for South American states. The cornerstone of his policy is to fight poverty through redistributive policies like rural and urban land reform, micro-credit lending, public education, food distribution, and health clinics. But the fact remains that still a large number of Venezuelans subsist on less than US Dollar 2.00 per day.

In most of the Latin American countries caught in the vortex of economic woe, it is largely the native Indians who are suffering the most followed by mestizos and poor Hispanics. It is the Venezuelan President Hugo Chavez not the ageing Fidel who is the voice of this discontent. In contrast to the growing appeal of communism during the era of cold war, the growth of discontent is wholly endemic. Deprivation has driven the poor of Latin America to desperation. Extreme poverty has left little meaning in their lives, their consciousness as self-respecting human beings has sank to the lowest level. Popular belief that they are being abused and subjugated, their wealth of oil, gas, timber, copper, other minerals, agricultural produce, labour, land, water and air is being flagrantly exploited by the big brother up north and their local underlings are in the garb of corporate Leviathan is growing stronger.

The haciendas, estancias or large estates and plantations are no less culpable for the exploitation of cheap indigenous labour. One can guess the intensity of the seething anger by listening to populist leader Hugo Chavez, 'the true cause of the fall of governments such as Sanchez de Losada's [in Bolivia] has to do with the poverty and misery generated by neoliberal policies imposed by imperialist models. That's the real cause of instability in the continent.'

Now Ecuador, Bolivia, Venezuela, Brazil, Argentina, Chile, Peru and Paraguay have also elected populist leaders. Venezuela's Hugo Chavez and Brazil's Luiz Inacio Lula de Silva are foremost among them.

It is a fact that exploitation in Latin America has a brutal past from the day the conquistadors started landing in the new continent. The original inhabitants of Latin America, the indigenous Aztec, Maya and host of other people suffered a brutal fate at the hands of the rampaging conquistadors from Spain and Portugal. By a conservative estimate approximately 50 million indigenous people inhabited the Americas in the late fifteenth century. What remains of them is anybody's guess. The demographic decimation equivalent to 90 percent has converted them into a neglected minority in their own lands.

It was the medieval age and the brutality and tyranny of the conquistadors in indiscriminate killing, ruthless subjugation and serfdom in the forms of tribute or encomienda and repartimiento, cuatequil, mit et al re-crafted the demographic landscape of Latin America. The ragged remnants of the acts of savagery and tyranny exacted by history toils today in the fields as poor peasants and in the tropical forests and Andean hills as fugitives from the business of governance in Latin America. The pathogen of this dispossessed people needs to be sincerely addressed by Latin American countries for redemption from the ills that may continue to afflict the continent. The season of discontent in Latin countries is reminiscent of the words of the words of Honore de Balzac that ' Behind every great fortune there is a crime.' At least the brutal disparity between wealth and poverty in Latin American countries tells us how equally true it is for improvident states.

Syed Maqsud Jamil is a freelance writer.