Jul 1 2006

The Morales Moral

Defy neoliberalism, face media wrath

To several observers in the U.S. media, Latin America’s leftward shift is the misguided product of a naïve populace that can’t understand economics and demagogic leaders who need to be scolded back into line. So when the recently elected president of Bolivia, populist Evo Morales, announced that he would be re-nationalizing the country’s natural gas reserves, the media response was swift and firm.

A Newsday editorial (5/3/06) called Morales’ move “obtuse economics” and admonished, “Nationalization of major industries has proved to be a road to economic ruin in an era of globalization.” The paper noted the Bolivian people’s “steady drop in their standard of living, which they blame on the United States’ free trade policies and global competition. But re-nationalizing industries and erecting protectionist barriers won’t solve their problems. They could exacerbate them.”

The Los Angeles Times’ editorial reprimand of Morales, headlined “Econ 101: Unnatural Disaster” (5/6/06), made similarly grim prophecies: “Bolivian president Evo Morales put his head in an oven this week and turned on the natural gas. There are only two likely outcomes: an explosion that ends his political career—or a slow suffocation for his people.”

The L.A. Times acknowledged that Morales’ decision was “hardly unexpected,” since he was following through on a hugely popular campaign promise that helped bring him to power. (It’s also worth noting that Bolivians overwhelmingly voted to take control of their gas resources in a binding 2004 referendum.) But in the very next breath, the paper cynically called that deference to the people’s will “disappointing,” lamenting that Morales didn’t take the same route as “wiser South American politicians such as Brazilian President Luiz Inácio Lula da Silva, whose leftist rhetoric keeps supporters happy while his more centrist policies keep the economy humming.”

The L.A. Times’ contrast of Bolivia’s impending “suffocation” with Lula’s “humming” economy has little basis in fact. Since Lula’s 2002 election, Brazil has averaged 2.6 percent growth; over the same period, Argentina, which is often criticized in the U.S. press for defying IMF economic strictures, has had growth averaging 9 percent. Venezuela, the South American example U.S. pundits would least like Bolivia to follow (see sidebar), has grown at a 6.5 percent average rate since 2002.

And though the L.A. Times warned that foreign companies “are now likely to stop investing entirely unless Morales backs off from his plan,” no company has made a move to pull out, and Venezuela has already promised to invest in Bolivia’s state energy company. As Dan O’Brien, an analyst with the Economist Intelligence Unit, told the New York Times in one of the more sober reports on the event (5/2/06), “Companies have costs invested in the country and they will be cautious to pull up the stakes and lose them.”

The L.A. Times editorial writers insisted that they were only looking out for the very people they asked Morales to defy, saying that the Bolivian public, the poorest in South America, would be the ones “paying the price for Morales’ rashness.” But the paper’s attempt at sympathy read instead like paternalism: “It’s true that the country’s resources have long been exploited by foreigners with little benefit to the indigenous population. But sending in the army to take over the gas fields isn’t the answer to Bolivia’s problems.” The editorial didn’t offer alternatives; it only deemed the people wrong to demand more of the profits from their country’s natural resources.

Please also see the sidebar to this article: Bolivia’s Soul Sold?