The current political turmoil in Bolivia
is part of a wider movement in Latin America, of people rejecting not
only corrupt politicians, but also – and more importantly – the neoliberal
economic policy paradigm that enriched a few at the expense of the vast
majority.
Bolivia is the poorest country in Latin America, with more than 70 per
cent of its population estimated to be living below the official poverty
line. In rural Bolivia the incidence of poverty is reckoned to be as much
as 90 per cent of the population, and there is almost no access to basic
amenities such as electricity and sanitation. For most farmers in the
country, until recently, the only thing that stood between them and starvation
was cocaine cultivation, which was banned under pressure from the United
States. Urban areas have been impoverished by massive job cuts because
of privatisation and more mechanisation in the mining industries.
Paradoxically, Bolivia is also one of the richest countries in Latin America,
in terms of its natural resources. The huge natural gas reserves are second
only to those of Venezuela in the region, and the country also has large
deposits of tin, silver and gold. The story in Bolivia, as in many other
countries similarly rich in natural resources, is of decades of plunder
by a small elite, ably assisted by multinational mining corporations and
watched over by US imperialism.
Again like much of Latin America, the economic reality has its counterparts
in social, political and even racial divisions. The ruling elite is inevitably
white, belligerently right-wing and closely intertwined with imperialism,
as well as openly contemptuous of democracy when it does not serve its
own interests.
More than 60 per cent of the population, however, is of "indigenous"
origin, while another per cent can be described as of "mixed race".
These groups constitute the political base of the increasingly more radicalised
left, which is currently making demands for public ownership of natural
resources and public responsibility for basic services that strike at
the very heart of the imperialist neo-liberal model.
To understand the current crisis, a little background is necessary. Two
crucial issues have dominated the contested terrain in Bolivia, as indeed
they are likely to do in the world as a whole in the years to come: energy
and water. The neoliberal model was imposed in a drastic form in Bolivia
from around the mid-1980s under the close supervision of the IMF and World
Bank. This involved not only the usual elements of fiscal contraction
and high interest rates, but also privatisation of energy extraction and
distribution but also of water and other utilities, resulting in huge
increases in prices and disconnecting supplies to poor people who could
not pay.
However, around five years ago, social movements and protestors, led among
others by the indigenous peoples’ leader Evo Morales, began to reassert
their position. The Cochabamba Water War of 2000 became internationally
famous when several weeks of violent conflicts between protestors and
the military led to the expulsion of a consortium controlled by the American
transnational corporation, Bechtel. The government of Bolivia has been
forced to pay heavy compensation to Bechtel.
Now there is another such war under way, in the shanty town of El Alto
close to the capital La Paz. From late last year, similar protests against
the privatization of the public water and sewerage system paralysed the
city and led to the termination of the contract held by the private consortium
Aguas del Illimani on January 13, 2005. This was a particular blow to
international donors, who had actively pushed this contract as being "pro-poor".
However, the issues is still not finally resolved and the conflict has
even intensified.
This is because there is still tremendous pressure upon the Bolivian government
from the World Bank, which became an associate of Aguas del Illimani through
its private sector lending arm, the International Finance Corporation,
which owns 8 per cent of shares. If the contract is cancelled, the Bolivian
government will have to pay a large compensation, and now the World Bank
has direct interest in guaranteeing the investment and will be the judge
of the likely forthcoming lawsuit through its agency the International
Centre for the Settlement of Investment Disputes.
One of the major demands of the current struggle is nationalization of
the oil and gas extraction industry, since the practice of the past and
currently is to export the country’s gas to the benefit of a small local
elite and the large MNCs. This was a promise made in the "October
Agenda" of former President Carlos Mesa, who took power in 2003 after
the hated and murderous regime of Gonzalo Sánchez de Lozada was
displaced by public uprising. That Agenda also promised a new Constituent
Assembly providing for more regional autonomy and representation to indigenous
peoples. This immediately came up against a strong rightwing reaction,
especially from the region of Santa Cruz which enjoys a massive concentration
of land and valuable natural resources in the hands of a few. Now Mesa
has himself been evicted by mass protests, because of failure to keep
to these promises.
The new Acting President Enrico Rodriguez is the former head of the Supreme
Court, who has so far been unable to stop the chaos. He has promised fresh
elections within six months, and these are definitely likely to provide
more power to the Left, which now has several leaders of rapidly growing
public stature.
President Hugo Chavez of Venezuela has described the current crisis in
Bolivia as one more sign that the "poisoned medicine" of free-market
democracy imposed by the US is being rejected by Latin America. But of
course US imperialism, however, distracted it may be by its travails in
Iraq and Afghanistan, is unlikely to let so much popular upsurge in its
backyard go completely unchallenged. What happens next in that region
is of great concern to everyone in the developing world, not only for
the ability to confront imperialism, but also in terms of building feasible
social and economic alternatives.