Brazil and the rest of Latin America suffer from huge income disparities
May 8, 2002
Letters on Brazil
I would like to comment on your editorial, "The Giant Next Door" (4/2/02) which is on the economic prowess of Brazil. The opening paragraph paints a picture of an economic giant. Readers should be provided with an alternative opinion. Brazil is a potential giant. But that is what it was more than six decades ago, and that is what it will remain but it is not a giant and even if it is a giant then it has to be a giant like India - a giant but not really a giant when you think of unspeakable illiteracy, horrible levels of poverty and unbelievable income disparities.
If there is any part of the third world that is a failure, then it is Latin America. More than a hundred years old, Latin America (including Mexico and Central America) is a failure in development. Your editorial tells us that Brazil is the tenth largest economy in the world. To this we can add that Venezuela is the fifth largest oil producer and the fourth largest seller of oil to the US. Argentina was a developed country stronger than many EU countries at that time but today is a wasteland.
Why is this so? I first encountered the tragedy of Latin America when I was a doctoral candidate at the University of Toronto. Previous to my stay at U of T, I had done graduate work at Mac Master University but for the study of the third world, the Caribbean area was my choice. At the University of Toronto, Latin America as an area of study was popular among Ph.D students from the third world and that was because most of our political science professors were specialists in LA political economy. So LA became my second area after my thesis area. I have never regretted the choice. Until that time, I believed that India and Africa were the tragedy areas of the third world but studies at the University of Toronto convinced me that Latin America is.
The first book we grad students read for Latin America was by the current president of Brazil, Cardoso. Cardoso was our bible in understanding underdevelopment in the third world. It is amazing that this very man now runs the fifth largest country in the world and the world's tenth largest economy yet has not done anything to bridge the gap between rich and poor in his country that he so angrily wrote about a decade ago. A few months ago, Newsweek took his government to task for a deceptive land distribution policy that the magazine more or less described as an ignominious failure. The government of Brazil replied to the magazine only to embarrass itself. The magazine responded with statistics that were revealing about the land distribution illusion.
Where are the trillions Venezuela collected from oil revenues over the decades? Where are the billions Trinidad has collected over the same period? A comparison reveals the horror that is Latin America. Trinidad used its oil revenue to bring about a more equal society. Today it stands as a little giant. Across the Caribbean sea is Venezuela where the more money oil brings in, the more unequal the society gets. What was revealing about Latin America, including Brazil, during my studies at the University of Toronto, is that for over a half century, income disparities have grown wider for every consecutive year. This is indeed a terrible human tragedy.
Let the Secretary-General for External Affairs for Brazil, who was in Guyana recently and who your editorial quoted at length from contest these figures. Any interested person can examine income disparities in Latin American countries from the annual IDB reports.
The question remains to be answered why this state of affairs in Latin America. In answering this question, one will find the reason for the recent temporary removal of Chavez in Venezuela. Before I go into the answer, bear with me while I digress. I had a Bangladeshi friend in grad school at Mac Master university whose views on so many things were offensive. He believed in forced sterilisation in South Asia, he believed in the military as a saviour of society and justified coups in his country and elsewhere. He believed women should be obedient to their husbands. He believed that you should be jailed for insulting religion. But the one area I found that he was on the same wave length with me was that he believed in the state as a mechanism for bringing about social equality. Herein lies my answer.
Latin American leaders and ruling classes do not believe in the concept of social equality. The ideology of social equality is ubiquitous in the third world even in harsh repressive territories. Readers will be surprised to know the area in the world where income disparities are constantly being narrowed is in the authoritarian Arab states. In South Korea before the return of democracy and in politically harsh societies like Singapore and Malaysia, social equality is accepted as a policy by the state. In economically devastated Africa and elsewhere like India, the Caribbean, the ideology of social equality can be found among ruling classes, prominent politicians and academics.
This ideology has no roots in Latin America. And its absence can be seen in its judicial and legal system. Such a system is far inferior to what obtains in Anglophone countries like Canada, US, Britain, Caricom, New Zealand, Australia. In Latin America, judges do not see themselves as being above the state and their role as a referee between social sectors. They see themselves as part of the state machinery whose role is to protect the state. In Latin America there is a 95 per cent success in securing convictions. This is in fact the highest in the world. This explains why Latin America has the highest percentage of overcrowded prisons in the world; simply put - once you are charged, you are going in, once you are in, you can hardly get out. Internationally famous political scientist, Robert Conquest believes the judicial system in Latin America is a mockery of what justice is. Judges in Latin America are more reviled by members of the poorer strata than even corrupt politicians and members of the ruling classes. From all that I know of how that system operates, I would not like to get arrested for jay-walking there.
Herein lies the answer as to why Chavez is in so much trouble. Chavez does have his faults (including his stupid passion for wanting to take over Guyana) but his ideology of social equality appears as something incomprehensible to Venezuela's traditional parties and ruling classes. They are afraid that the oil money which is meant for traditional circulation will now be used for social purposes. This is ideologically unacceptable to them. For Latin American ruling classes the state's role is essentially a security one - to provide for territorial peace. Herein too lies the reason for the fifty year old war in Colombia. The average Colombian couldn't be bothered with the guerrilla war. It means nothing to them because political parties since the forties have done nothing for them.
It will make interesting reading to do a comparative study of military take-overs across continents. There is no space to have a discussion here but the coup in Pakistan is representative of the reasons for military governments in Africa and Asia. The army intervened in Pakistan because the two major parties were pathologically corrupt. The Pakistani people do not want them back in government. In Venezuela, the army took over and installed a businessman who was the head of the private sector. Latin America coups are always taking place against a background of trade union demands, political protests by left-wing parties or the policies of populist presidents, as in Venezuela last month. The answer lies in ideology. The African and Asian generals intervene to stop the excessive corruption in the relation between ruling parties and ruling economic classes. In Latin America, the generals take over to stop the ideology of social equality from spreading. After the coup is complete, you see a merging between army and the business class. To put it cynically, in Latin America, the army intervenes to stop the wealth of the country from spreading downwards. Mr. Chavez is certainly not out of the woods yet. He must be a very worried man.
Maybe we should end this letter with Brazil since it began with Brazil.
For a country that is so large and with an economy so big, who owns the land and where does money go? Well certainly not to the poor. For in Brazil, the land war involving landless peasant and wealthy kulaks and super rich ranchers is never-ending and brutal. And the money certainly doesn't go to the poor for North-East Brazil has some of the world's most disgusting and nauseating manifestations of poverty. President Cardoso is scheduled to meet with Caricom heads in July. What can he tell our leaders about development? I am betting anyone that after this year when President Cardoso demits office, he will once more become Professor Cardoso preaching once again about underdevelopment in the third world. This time around though, I'm betting too there will be no converts at the University of Toronto.