Decentralization and Federalism

Hi class,

Decentralization is relevant as a process that tries to address hierarchies. Hierarchies are problematic for economists and public and private managers because they create much more problems while managing resources (especially public resources) than markets. This happens, mostly, because of the way they tend to organize themselves.

Broadly speaking, a hierarchy is any structure of power. Churches, especially the Catholic Church, explicitly acknowledge the existence of such structures and they call them hierarchies. In organizational studies, any structure of power is a hierarchy. They are problematic because when they become too large, they tend to impose political, personal, or clientele criteria in the use and distribution of the resources, reducing the overall efficiency of the processes they perform. This is what economists and managers call externalities.

Historically, the move towards decentralization as a concept goes all the way back to the works of Alexis de Tocqueville, the author of Democracy in America.

Tocqueville wrote:

Decentralization has, not only an administrative value, but also a civic dimension, since it increases the opportunities for citizens to take interest in public affairs; it makes them get accustomed to using freedom. And from the accumulation of these local, active, persnickety freedoms, is born the most efficient counterweight against the claims of the central government, even if it were supported by an impersonal, collective will.

More recently, the observation of bureaucracies and the externalities they face prompted a series of changes in the late 1960s in highly centralized countries as France (a unitary, Presidential polity) after the defeat of Gen. Charles de Gaulle in the plebiscite called in 1968. However, it is possible to find examples of this need to decentralize in large U.S. corporations such as General Motors, Ford, General Electric, and the like during the late 1960s and early 1970s. The U.S. government itself acknowledged this problem when, in the early 1970s, forced the partition of "Ol' Mamma Bell" into the Baby Bells. Not only Big Bell had a monopoly over telephone communications, but it was very inefficient in providing that kind of service.

The tendency spread out to other Western countries during the late 1970s, mixed in many cases with the rise of what here and in Britain is called conservatism and in the rest of the world is called neoliberalism, the case of Britain and Margaret Thatcher is paradigmatic of this convergence. That leads some uncritical observers of Latin American reality to mix-and-match neoliberalism with decentralization.

However, it is necessary to acknowledge that way before the emergence of the International Monetary Fund as the factotum of policy in the region, the governments of Latin America were already aware of the need to promote some forms of decentralization or administrative reform.

Decentralization as a theory rejects the assumption that we need some form of hierarchy or structure of power, seeking to raise specific questions about the specific types of hierarchies that are necessary in any given circumstance. It sees hierarchies (for that purpose any form of authority) as arbitrary. After this first question about the need of structures of power, decentralization asks for the specific forms of structures of power that are better for the processes we are addressing or considering.

Decentralization does not reject authority or hierarchies per se, but acknowledges the need to challenge systematically the specific forms of authority or hierarchy to develop at any given moment the best form of authority possible.

From a very abstract perspective, decentralization de-sacralizes power that is why it rejects fixed structures of power and seeks to develop fluent exchanges of information between service providers and clients.

Our Readings

Falleti is mostly concerned with the relations between executive authorities at the three levels of government in the four largest countries in the region. Willis, Garman and Haggard are concerned with the role that political parties have had in these processes.

Their key findings are:

1. Decentralization is a sequential and path dependent PROCESS. Falleti´s emphasis on the procedural character of decentralization seeks to highlight the fact that we cannot understand these processes as black or white kind of processes. Up until today in Mexico, as an example, there are political actors seeking a broader decentralization, while—of course—there are other actors seeking to expand the role of the Federal Government at the expense of the local and state governments.


2. Decentralization happens or not regardless of: the type of regime (democratic or authoritarian); the Constitutional structure (federal or unitary); and who is in charge (civil or military). The four cases used by Falleti provide different examples of this. Mexico was formally a Federal republic, but it was in actuality a very centralized polity; Colombia was a extreme case of political centralization, ridden with extreme illegal organizations (the guerrilla and the drug lords) challenging the ability of the State to control territory and to provide for the needs of the population. Argentina was a very stiff military regime, unable to open itself to the kind of progressive reform that happened in Brazil, where the military tried to combine a strong authoritarian leadership at the national level, with democratically elected subnational leaders.


3. The reason for it, and this is my own take from the Mexican experience, is that it happens because decentralization as well as federalism and other buzzwords of Latin American political jargon, are usually labels behind the “real” policies. In Mexico’s case, a very centralist and authoritarian government, labeled, however as federalist and democratic, started in the late 1970s a decentralization process. It was their way to deal with hierarchies and their externalities (in simple language with bureaucracies and the red tape they crate). Among the problems were: the inefficiency of local political bosses to aggregate political support for the PRI. With the challenge presented by different political actors, some of them legitimate as the Partido Acción Nacional and some others marginal or even illegal as the guerrilla organizations active during the mid 1970s. In addition, with the externalities (problems) created by the hierarchies. Moreover, the Mexican political elites’ response to these challenge was paradoxical, because on the one hand—as Willis et al. nicely explain—it actually decentralized by allocating more resources to the states and municipalities, although—on the other hand—it also centralized power in the figure of the Secretary of Budget and Planning. Interestingly enough, three of the last four presidents of Mexico were before their election heads of that secretary (Miguel de la Madrid Hurtado, Carlos Salinas de Gortari, and Ernesto Zedillo Ponce de León). That gives you an idea of how powerful that position in the cabinet was. Moreover, it was that secretary the one in charge of the decentralization process in Mexico up until its fusion with the Secretary of the Treasury in 1992.


4. The different outcomes of the decentralization PROCESS are less a result of particular or individual policies, and more the product of the EVOLUTION of such reforms and the type of actors empowered along the way. The path dependent nature of the PROCESS is clear when one considers how their decentralization programme developed within the context of the Argentine military regime and how it has evolved over time. Conversely, the Colombian process reflects the willingness of the national government at the beginning of the PROCESS to introduce deep changes in the structure of the polity. One could argue, considering the evidence provided by Willis et al., that the failure of Venezuelan democracy is correlated, at least partially, with the externalities that a unitary, centralist, presidential government creates in terms of the hierarchies running the show. Is not a surprise that the main problem with Partidocracia (Party-cracy) was precisely in terms of corruption (el cogollo).


5. Willis, Garman, and Haggard’s piece is valuable because it introduces the issue of the role of the national political parties as a key aspect of the decentralization process. It is not a surprise that polities where the parties were under severe constraints (Argentina during the military dictatorship banned the Peronista party, as an example) had poor outcomes. The same can be said of Federalist polities where the President does not enjoy a legislative majority (hence Mr. Fox problems in Mexico nowadays with the fiscal reform). Divided governments (like the situation that Bill Clinton faced here in the States during much of his term) produce (as contemporary Mexico confirms) deadlock.


6. Although decentralization can have positive impacts on poverty and other key topics, we cannot be too optimistic about the outcomes of decentralization processes. The best example of it comes from Colombia. But, of course, as Leah wisely pointed out, the main problem there is that the old centralist, unitary, and presidential system confronted the additional challenges brought by the guerrilla and the drug lords. Here you can get a brief newsletter analyzing some of the negative and positive processes of decentralization worldwide.

We could analyze these processes also by using Foucault’s approach on governmentality. The national governments display their technologies of power, which are confronted by the subnational governments’ technologies of self and their own technologies of power, and out of the interplay of these two forms of technologies, of specialized knowledge expected and unexpected consequences emerge.

I believe, as I already mentioned in class, that when analyzing processes like decentralization or federalization it is necessary to pay attention to the specific policies and path dependent and non-path dependent processes. Moreover, whether as policymakers or as social entrepreneurs or as social scientists or even as simple citizens here in the US, in Latin America or in Europe, we need to pay attention to this interplay of technologies of self and technologies of power and be ready for unexpected consequences.

One way to avoid some of the unexpected consequences brought by large scale planning (the six-year National Development Plan that Mexican presidents must submit to the Congress during the first year of their term could be a good example) is by considering as much voices as possible in the processes: think, as an example of the kinds of audiences that the MTA or many other agencies hold here in NYC everytime they need to raise fares or when they decide to expand a line or to renew or close a station.

If you want to get some more information on the topic, go to the Website of the Organisation for Economic Cooperation and Development.

I also mentioned in class the existence of these new forms of organizations called heterarchies, something in between a market and a hierarchy. A heterarchy can be defined as "horizontal self-organization among mutually interdependent actors." If you are interested in that topic read this brief paper (12 pages).

Latin American Cities and Capitalist Development

Hi class,

Today’s readings offered a good summary of most of the research and most of the policies carried in Latin America in the last 40 years.

Portes’s reading is relevant not only because of the literature review he offers, but also because of the way in which he connects the (mis)adventures of Capitalist development with the attempts to plan and regulate the growth of Latin American cities.

Angotti’s piece is relevant because it connects at one level with Portes’s in stressing the role that capitalist development has in shaping the city as a privileged space for the exercise of different forms of power, but also because of the consideration of the kinds of constraints that such type of development puts on the city.

Rosie’s question regarding the ability of the governments to plan or not the development or the growth of the city it is relevant at many different levels. On the one hand, it can be answered by saying yes, there is planning, plenty of it. The budgets of Latin American cities are filled with studies and analysis seeking ways to improve the quality of life, the goods provided, and so on. However, of course, the problem is that almost all those plans require money to be carried and money is not easy to find, especially if you are under severe fiscal constraints.

Moreover, it could be argued that Latin American cities (as any cities in the world) provide good examples of the kinds of contradictions, tensions, and unexpected consequences that capitalist development generates. Back in the 1970s, French philosopher Michel Foulcault (I can see Matthew scared and running away from this one) came up with the concept of Governmentality as a key tool to try to address the complexities that attempts to regulate the use of physical space have all over the world.
Of course, the unexpected consequences are most evident in cities in fragile fiscal shape for obvious reasons, but the problems exist regardless.

Foucault coined the notion of governmentality as an attempt to encompass in one single concept the uses, tensions, intentions, contradictions, unexpected consequences, and strategies to challenge and to resist power.

I know is big as a bomb. However, one way we can breakdown such concept is by thinking of governmentality as 1) a research strategy, and 2) a conception of governing. As research strategy governmentality «seeks to explore power relations, particularly in the domain of what constitutes conduct» (Lechte, John Key Contemporary Concepts. Sage, 2003, p. 98). As a conception of governing, it is connected with the concept of government, but is not reduced to it. That is to say, not only the government has strategies of governmentality: firms, small and large; churches; sports organizations, and so forth and so on. Any organization that has some goal or aim needs to display some form of governmentality at some point.
It is important to stress that, unlike Marxist thinking and some other radical approaches to power; Foucault’s radical-ity when dealing with power resides in the fact that for him power is not «a limit to freedom … governmentality must be understood as a set of actions or practices enacted over free individuals, actions realized only to the extent that individuals are free» (Lechte 99).

Moreover, Foucault’s governmentality «points to a domain which covers more than the legitimate forms of politics and government; it is imbricated in all the actions of people; for this is what the art of government entails. In itself it is neither good nor bad, desirable nor undesirable. Rather is the very field of contestation itself, should there be contestation, as it is the very field of acquiescence, should there be acquiescence» (Lechte 99).

I do not think that is necessary to elaborate too much on how the policies and plans to regulate the development and growth of the city (Mexico City, New York, London, or Beijing) fit nicely for analyses based on this approach. Mostly, because it is there in the endless battles to shape the form and the function of areas of the city that is possible to see contestation and acquiescence.

Now, when we analyze processes like those considered by Portes and Angotti, using governmentality it is necessary to identify within each interaction between individuals and the power three different sub-processes:

a. Technologies of domination
b. Technologies of self
c. Both unexpected and expected consequences coming out of the interaction between both technologies

(In this section, I will be using and adapting extensively Jennifer Smith-Maguire’s article “Michel Foucault: Sport, Power, Technologies and Governmentality” in Theory, Sport and Society. All the portions in quotation come from this article.)


a. Technologies of domination

The technologies of domination seek to «optimize the use of resources» of all type, from the resources of the body to the resources of polity. To achieve such optimization one follows what Weber would have called a rationally oriented (social) action: one tries to find the optimal means to achieve the stated goals or aims. The operations required to select such means involve «systematic, specialized forms of classification and categorization of human life» (censuses and the like) reflecting relations of power. Such relations of power will never generate zero-sum outcomes and are positive exercises of power, at least theoretically, technologies of domination seek to «constrain choices, such that individuals more often than not are productive and active in ways that more often than not, reproduce the social order. As the range of choice narrows, the degree of domination rises.»

Technologies of domination (or power) «fall within two broad modes, reflecting the ongoing tension between, on the one hand, the state indirectly relying upon individuals to maintain social order» (the market), and on the other «the state directly governing the productivity of the population as a whole» (the law). That is, «technologies of domination work in both individualizing and totalizing modes, producing different, interrelated bodies of knowledge that work through the same rationality of optimization through normalization» (plans to regulate urban growth or development).


b. Technologies of self

Technologies of power or domination aim at shaping individual and collective choices among those targeted by such technologies. According to Foucault technologies of self: «permit individuals to effect, by their own means or with the help of others, a certain number of operations on their own bodies and souls, thoughts, conduct, and way of being, so as to transform themselves in order to attain a certain state of happiness, purity, wisdom, perfection, immortality» Michel Foucault (1988) “Technologies of Self” in Technologies of Self: a Seminar with Michel Foucault. Amherst UMA Press.

Technologies of self are useful, as one of many possible examples, to explain the decision of many Latin Americans to leave their towns of origin heading to Mexico City, Buenos Aires or Río de Janeiro, and in some cases, from there to Los Angeles, Madrid, or Lisbon. They are useful to explain also autopoietic initiatives that seek to articulate groups or organizations in trying to improve their lives even if it is only at the level of survival strategies. Often times, technologies of self involve doses of conscious and deliberate resistance and rejection of the technologies of domination or power.

Moreover, technologies of power (think of many laws here in the US or elsewhere) have what Smith-Maguire calls «contradictory or ambivalent effects … lying at the heart of opportunities for resistance» (p. 304). That is the case of laws or planning and development programmes that aimed, with the best imaginable intentions, at solving or at least taming specific problems or issues, but that in the end create «new and different problems. »


c. Unexpected and expected consequences coming out of the interaction between both technologies

Here is where governmentality becomes problematic and critical to understand the successes of some policies (beautification of urban spaces or gentrification, as an example) and the failure of others (annihilation of local traditions and knowledge, social conflict, and the like).

Both Angotti and Portes provide good solid examples of technologies of power, of technologies of self, and of governmentality as this random interaction between technologies of self and domination.

If any of you are interested in exploring more the concept of governmentality let me know, I will point you in the direction of some interesting articles.

About Lawson's and Mainwaring's articles

Hi class,

The academic, policy, and political debates regarding the nature of political regimes in Latin America are relevant because the definition of what is democratic, under what circumstances and with what kinds of trade-offs, rests at the very core of social change in the region.

All the actors in the region present themselves as advancing some form of democratic agenda in the region. Your own papers will make at some points judgments about the democratic nature of country X or Y.

So precisely, because we are aware of the risks associated with broad generalizations, poor classifications, and with orientalism, it is necessary to sharpen our concepts, which are the tools to carry analysis and research.

Lawson

Lawson’s piece is particularly relevant because of its critique of conceptual relativism (p. 191) and its acknowledgement of democracy and democratic governance as both theoretical and normative concepts. We cannot deny this double function. We need to acknowledge it and work through it in order advance our academic/political interests.

A valuable feature is her adoption of constitutional opposition as the key criteria to define democratic rule. Without it, there is no way to talk about democracy. Moreover, such concept works both ways. It helps to analyze the regimes and governments’ policies and decisions, but it is also helpful to analyze opposition movements.

This is relevant because at different points in history and all over the region it is possible to find new social movements, political parties, and leaders that, claiming to be democratic, deny the value of Lawson’s criteria.

Another valuable contribution of the paper is its use of the concept of democracy’s "internal complexity" (p. 192). The relevance of it lies in the fact that democracies and especially poor democracies as Latin American democracies are, are frequently confronted with pressures to prioritize following different criteria than those used by democratic regimes in developed countries.


Mainwaring

Classifications are relevant among many other reasons because all of you at some point of your papers will develop some basic or elaborate definition/classification of democracy as a way to explain whatever issue you are interested in analyzing.

One can “read” Latin America’s recent history in the key of the construction of democracy and democratic governance. From that perspective, Mainwaring’s text is valuable for its review of some of the most heated debates regarding regime classification, democratic regime viability, and the conditions required to achieve such durability.

One could argue, however, against Mainwaring by using Landman’s evidence on the relation between democracy and development and Sokoloff’s evidence on the role of religion.

From other perspective, it could be argued that in actuality no country in Latin America could be a good “host” for democratic governance since no one will provide the ideal set up for democratic regimes. What is relevant, however, is that democracy is still perceived as both possible and necessary.

One interesting aspect of Mainwaring’s piece is its account of the role of the left and how, after the collapse of the Soviet Union the left radically changed both its methods and its political discourse. I think he is too harsh when dealing with the Latin American left's reasons and methods, mostly because it is nearsighted when it comes to dealing with the issues of the cycles of violence detonated by U.S. military interventions and by its supports to “sons of bitches” like the Somozas.

Moreover, questions remain at least at two different levels. On the one hand, as to establish if the emergence and resilience of revolutionary left groups in Central America, Colombia, and Bolivia was connected to the support of the U.S. government to firms such as the United Fruit and to ruthless military or despotic regimes? On the other, what was and has been the responsibility of the extinct Soviet Union and Cuba in breeding and feeding those groups.

The Mexican deal with the Cubans provides a good counter-factual to other cases in the region. It shows how in the absence of Cuban and/or Soviet support leftist revolutionary groups had a hard time reproducing themselves.

However, since we are dealing here with the realm of politics and not classical physics there is nothing straight, simple, and plain. The Mexican upper hand with Cubans during the 1960s, 1970s, and well into the 1980s would have not been as successful if other countries in the region (as Panama did it during the Torrijos’ regime) were willing to reach similar deals with the Cubans.

It is noticeable that now that the Cubans have “no dough” to share with revolutionary groups, the problems associated with poverty and exclusion remain, and therefore the ability of groups to promote radical programs of social transformation and that is proved by the emergence of new guerrilla groups in Mexico after the implosion of the Soviet Union. Moreover, one major problem created by this pact with the Cuban government is that the extreme left groups in Mexico deprived of “natural” connections with other similar groups in the region, sought help and collaboration from the organized crime.

Latin America Before the Neo-Liberal Wave

Hi Class,

I know that perhaps I was not as clear as required during my exposition in class today, so I will try to put ideas in order here. I will do this in several parts. First I will try to give you an overall account of the kind of situations that prevailed in Latin America prior to the neo-liberal wave of the late 1980s. In future deliveries, I will address the theory behind market convergence, the change in the role of the State and some of the reasons behind the claim for fiscal discipline.


Latin American Economies at the End of the 1970s


Why Latin America came to be at the mid 1980s such a fertile ground for policies generally associated with neo-liberalism? The answer to such question must be found in the role that the states, the countries' governments assumed after a long period of expansion, during the 1970s. I will use Mexico’s example with some references to other countries in the region.

By the end of the 1960s Mexico was at the end of what was called the “Mexican miracle”. Forty years of internal peace and fifty years without a foreign, either U.S. or European, military intervention had allowed for a series of key changes in the country. The only similar period of internal peace and absence of foreign conflict were the 30 years of Porfirio Díaz as president from 1880 to 1910. As a consequence several key indicators of consumption, wellbeing and public expenditure registered key changes. The country had just hosted the Olympic Games (1968) and the Soccer World Cup (1970). However, social tension existed. That is why we had at the end of the 1960s the awful massacre at Tlaltelolco as the corollary to a series of repressed social mobilizations.

The expansion of the economy had happened under the hypotheses developed right after the Great Depression of 1929, the end of a globalization period itself. The key assumption in Mexico, the rest of Latin America, the US and Europe was that you cannot trust that much global processes of economic integration because a global crisis has devastating consequences. The sound conclusion to such premise was that the state had a key role in shaping policy through what was known as “interventionist” and/or Keynesian (honoring British economist John Maynard Keynes) or expansionist policies.

Keynesian or expansionist policies generally assume that to induce growth or to improve the performance of any given economy it is necessary to increase or to expand (hence their second label) the government's spending. These expansionist policies were behind the recovery of the U.S. economy during the 1930s, but to be successful you must be able to increase the availability of cash, either by printing more bills and/or by lowering the credit rates. Also, you must be ready to deal with inflation.

On the other hand, a good example of interventionist policies in the U.S. are the policies of affirmative action or, as they are called in Europe, “positive discrimination.” Other good examples of such policies are the housing projects developed in large agglomerations like New York. The ideas behind such intervention were, on the one hand, at a general level regardless of the level of development of your country, that the state, the government, was intervening to address a failure or insufficiency in the market.

You can have both policies at the same time (interventionist and expansionist), or as it happens nowadays, only interventionist policies that try to adhere to some notion of fiscal discipline, however back in the 1970s in Latin America almost all programs were both interventionist and expansionist.

The second assumption, specific to Latin American countries, was that such intervention had to develop self sufficient economies, following the criteria that, as one of many possible examples,
Max Weber set in Economy and Society. Hence the need to carry the import substitution policies and, among others, the protectionist policies aimed at guaranteeing the development of a national, self-sufficient, economy.

In Mexico and elsewhere in Latin America those “interventionist” policies took the form of direct and universal subsidies to different goods and services: public health (universal free vaccination, as an example), public education, and so forth and so on. However, and this is relevant to connect the issues considered on the readings on citizenship those policies were implemented with a great doses of clientelism.

In the region "interventionist" policies were almost always coupled with "expansionist" policies. This happened because governments were either unable or unwilling to collect taxes to increase their ability to intervene. Here you can see some of damaging effects of oil revenue. Instead of collecting taxes while carrying an aggressive interventionist program (as is the case of Sweden or Norway), they preferred to either print cheap money or to borrow it from foreign lenders, assuming that commodity markets will go their way. Clientelism was perceived as politically viable precisely because the governments in the region expected to be able to cash in the profits of their commodities.

The Culmination of the Miracle

To illustrate my point I will use the example of the public housing policies developed in Mexico at the beginning of the 1970s. At that time, the Federal Government founded the Instituto del Fondo Nacional de la Vivienda de los Trabajadores (Infonavit, Institute of the National Fund for Worker’s Housing). The idea was to provide cheap housing to the families of workers in the formal circuits of the economy.

Back in those days most unions in the country were part of one of the major workers’ centrals in the country: Central de Trabajadores de México (CTM), Confederación Regional Obrera Campesina (CROC), or were a part of the Worker’s Congress (CT) a federation of unions. However, and here is where the plot thickens, the CTM, the CROC and many other unions were a part of the Workers’ Sector within the ruling Revolutionary Institutional Party (PRI). The workers of the federal government belong up until today to the Federación de Sindicatos de Trabajadores al Servicio del Estado, which was also at that time a part a of the PRI.

Even if the original draft of the law that created the Infonavit proposed a raffle as the mechanism to assign housing to the workers, the labor caucus in the Federal Congress (all of them leaders of some of the major unions affiliated with the Workers’ Congress if not directly with the CTM) decided that such mechanism was not adequate. They decided that the worker must have the approval of his/her union’s leader in order to be eligible for the raffle.

As you can imagine, this kind of mechanism gave all sorts of power to the union leaders to decide who were eligible for that raffle. Ultimately, the beneficiary of such concentration of power was the PRI and its bosses. That mechanism fits nicely within Lucy Taylor’s argument regarding the existence of two mechanisms of political participation in the region’s polities: citizenship and client-ship.

Moreover, the law that created the Infonavit established that all housing units were going to be built by Infonavit itself. You might think well, that is cool, not? Well, not really. The main problem with that kind of approach is that again, as in the case of the football clubs, the government was adding yet another activity to its extensive portfolio of activities. As I mentioned in class, in some cases the government took over bankrupted firms arguing that it was better to preserve the existing jobs, than to let the firms (and the jobs) die. The willingness of the government to take over bankrupted firms made it the owner of professional soccer clubs, bike factories, one bar (El Patio), movie theatres, studios, radio stations, TV networks, and so forth and so on.

This ever growing public sector created problems, due to the size of the government. There is a huge debate about the issue of the size of the organizations. Some assume that large organizations create a series of problems of management because of the “hierarchies” created within such large conglomerates. Those hierarchies make decision making/decision taking a matter of personal and group interest and not a matter of efficiency. Of course, as any thing in this world, there are those who assume that the critiques to large organizations are ideologically biased and that evidence is not conclusive. I personally adhere to the first group. I have carried research in Mexican dioceses, and I have found that, as a rule of thumb, small dioceses where the bishop knows personally his priests and the lay leaders outperform large (arch)dioceses where decisions are made by bureaucrats and where relations between the (arch)bishop and his priests and lay leaders are distant.

Moreover, there is evidence of how, by the end of the 1980s Infonavit (and other similar housing governmental programs as FOVI and Fovissste) had enormous bureaucracies, producing poor quality housing, that often times were unsuitable for living. Take as an example many of the housing units built by Infonavit in states like Veracruz, Tabasco or Guerrero. In those states average temperatures around the year resemble the kind of weather you have here in New York during the summer, with similar levels of humidity. A house or apartment designed following the criteria set by Infonavit for houses in Mexico City (low ceilings with no air conditioning) makes no sense in tropical areas of Mexico where temperatures are extremely hot and humid.

So, not only you had this bureaucratic gateway to decide who were eligible to get housing from Infonavit, FOVI or Fovissste. You also had problems with the quality of the construction and, of course, with the prices set by the government acting as developer or realtor, because being the government the main builder it had a privileged position to set prices. This not to mention all the problems associated with the actual operation of the construction sites, often times full of what was called at the time "ant's robbery" (robo hormiga) or with large scale fraud with the criteria to buy cement, bricks, and other construction materials.

Again, the problem here is not the intentions. The intentions of the government in Mexico were, as almost always is the case, very noble. The problem was the choice of policies to achieve the aims.

Now, this model got a boost in the mid 1970s when, all of the sudden the Mexican petroleum firm Pemex discovered vast oil fields in the states of Tabasco and Campeche. José López Portillo’s government assumed that with the new cash flow from the oil boom at that time (the barrel of petroleum reached a peak after the boycott by Saudi Arabia and other Arab countries) what the country required was not a democratic reform as Luis Echeverria’s government had unsuccessfully tried. What was necessary was a more interventionist government able to provide for all the needs of the population, which in turn will allow appeasing any criticism to his government that, by the way, suffered from the outset because López Portillo ran in 1976 as the sole and uncontested candidate of three different parties (the center-to-right opposition of the Partido Acción Nacional split in a heavily disputed convention and was unable to nominate a candidate).

Once aware of the new riches, López Portillo’s State of the Union address in September 1st 1977 made a call to “manage the abundance” (administrar la abundancia). Since then, and especially after the painful aftermath of his government, the phrase “administrar la abundancia” has been used to make fun of grandiose projects that have unexpected negative consequences.

Tweaking the Peso

Now, as I mentioned in class, other key area of governmental intervention is that of the currency exchange rate. During the 1950s and 1960s the general hypothesis applied in the major economies of the region was that a fixed rate of exchange with the dollar was not only possible but better for the performance of the economy. A fixed exchange rate helps some sectors of the economy (especially those buying technology, machinery, or intermediate goods outside the country), but it hurts other sectors (especially those exporting commodities). Moreover, a fixed rate also has other (unexpected negative) effects. Among them, it subsidizes sumptuary consumption. At some point in Mexico, in the 1960s, as an example, it was cheaper to get a washing machine in Texas than to buy it in Nuevo León, so people had incentives to go to Texas to buy those kind of goods or, even worse, to buy them as contraband in Mexico City.

The situation with contraband in Mexico City in the 1970s was so bad that an entire section of the city (Tepito) became a sort of “free-port,” where the federal and local governments, for reasons connected with corruption of the police corps, decided not to exercise their authority. Similar phenomena happened all over the region. The consequences of this situation were similar to the ones created in the US by the Volstead Act (Alcohol Prohibition). On the one hand, you have a noble but rather unrealistic aim (to protect the Mexican industry or to prevent alcoholism in the US). On the other hand, you have “creative” entrepreneurs willing to challenge the governments’ noble aims. Those “creative” entrepreneurs are known here and in Mexico as organized crime for reasons that are easy to understand.

On top of it were yet more problems. Another way in which governments end up subsidizing sumptuary consumption is the case of those interested in going to spend a holiday week in Paris or here in New York. You will be getting cheap (fixed rate) dollars in Mexican banks to go to Paris to drink champagne or to Manhattan to drink a Manhattan cocktail (remember, I am talking about the 1960s and 1970s). Groovy, isn't it?

Overtime, especially when you are dealing with large quantities of dollars, these kinds of situations create big holes in public finances. You may think, well, lets control who get those cheap subsidized dollars and that is certainly a possibility, but only if you were able to eradicate the black market. Just think that even in Cuba, with the anti-U.S. sentiment and the pressure of Castro’s government to prevent the use of dollars as a mean savings, you still have a black market of U.S. currency, so Mexico with a border as porous as the one we have with your country was unable to do it. That was one of the reasons behind the decision of the government to devaluate the Mexican Peso, first in 1976 and from then on a regular basis: it was impossible for the government to keep subsidizing cheap dollars because almost always you will do it by pulling money from other programs or, what is worst, by printing money. On the other hand, when you keep a fixed exchange rate for a long period your exports will loose competitiveness in the world market. So, again, the plot thickens. How would you as a government be able to bring competitiveness back? You lower the exchange rate, making your exports cheaper. This one was yet another reason behind the decision of the Mexican government to devaluate the Peso in 1976.

The good intentions of keeping the fixed rate originally were to help some sectors of the economy to buy technology and machinery, to provide some sense of order to the entire market. The unexpected negative consequences were that your products (most of them raw materials and commodities) lost competitiveness in the world markets, because over time they became more expensive, and this in spite of the fact that, as Robinson clearly states in his article, the prices of all commodities sold by Latin America were registering significant drops. The problem of course, is why we kept depending on those kinds of exports.

The Road to Hell…

As a way to address those problems new good intentions emerged. Therefore, to regain competitiveness governments changed the exchange rate. But then again, reality came to bite back with a handful of negative unexpected consequences, the most important of them in the form of inflation. Economists will agree that a relatively low inflation rate can have in certain circumstances good effects for the entire economy.

The problem however, comes when inflation goes out of control, and that is not a decision that rests on the government. On the contrary, inflation and especially hyper-inflationary processes as the ones that Argentina, Brazil, Peru and other countries in the region experienced in the late 1970s early to mid 1980s are collective processes where all bets are off. Producers have no way to set in a rational way the prices of their products, so they raise them as much as they can to try to gain some coverage from sudden changes in the market. Unions make constant demands for wages’ increases (strikes and mobilizations included) that makes the entire operation of firms a constant challenge. Rents are set in dollars or adjusted monthly against the dollar or some other indicator (inflation rate, leading lending rate, etc.) so persons with low incomes will have a bad time finding a place to live. At some point, the banks stop lending because the entire operation becomes unmanageable, and the government itself a key economic agent, becomes dependent on relatively cheap new money by either borrowing it (inside or outside the country) or, even worse, by printing it (ab)using its right to coinage.

Also, as I mentioned in class, people in those kinds of circumstances see no benefit from saving. On the contrary, if you get your salary you better go to the store to spend the whole thing in whatever you may need for the rest of the month, because perhaps by the end of the month you will not be able to buy those goods.

Alternatively, if you are able to save, you do it by buying dollars (which is a weird bet against your own currency because ultimately the pressure to devaluate your currency grows). Or, even worse, if you can, you send your money to a U.S. bank to try to protect your savings from confiscatory policies of your own government (depriving your own country of a valuable resource and betting again against your own currency) or if you are Mr. Big Bucks you send it to off-shores, with the same outcome at a larger scale.

Regressive Tax

Now, despite its origins as a policy aimed at controlling key variables of the economy, the cycle of devaluation-inflation has by itself very disturbing consequences for the entire economy. That is why there is a school of economic thought that calls inflation a “regressive tax”. Why? Well, among many other things because people with enough money can protect their savings by converting them overnight to dollars (or back in those days German marks or British pounds). People who are unable to do so keep their income in local currency, running the risk of loosing the value of their assets overnight, as it happened in the hyperinflationary context of Brazil. Moreover, there is ample evidence on how unfair is the allocation of the burden of the inflation is, mainly because it hits harder on those who have little or no chances to save. Here you can read an article on the subject.

In some cases, as in 1976 in Mexico, the devaluation of the currency was announced to acknowledge a series of de facto situations (a huge difference between the official exchange rate and the one in the black market, subsidies to sumptuary consumption, etc.). However, in other cases governments induced this process by increasing the amount of bills and coins available at any given period (hence the relevance of the term coinage, the right that states have to make coins that I used in class) in the economy. With policies like that, all of the sudden you will have a huge amount of pesos, soles or cruzeiros available to buy dollars, giving the entire process yet another hike.

In Mexico in the late 1970s, after the 1976 devaluation and the 1977 announcement of the new oil riches in Tabasco, the government increased on the one hand the amount of bills circulating in the economy. After all, the assumption was that we were going to be floating in a sea of petro-dollars, as they were known at the time. Over time, this situation conflated with the huge borrowing of foreign and domestic debt prompted by the assumption that the country was going to be rich (administrar la abundancia), and with ridiculous patterns of consumption (both by the government, the private firms and individuals) made possible by the sudden influx of cheap petro-dollars and the lack of fiscal discipline. A flash back of Tepito, Mexico City's "free-port" in those years will let you see French wines, European chesses, and even the first models of personal computers displayed in the forefront of the houses of an apparently poor neighborhood.

Of course, not all things from this time were wrong. Mexico City’s underground, as an example, was expanded. New public schools (my own Junior High School and my University!) were built. The Social Security system was expanded (so much that it ended up owning two Premier League soccer teams, Atlante and Oaxtepec). New highways were built all over the country. Also, as an example, a nuclear plant (Laguna Verde) was built.

However, the party came to a sudden stop when the oil prices went down and interest rates in the world markets went up. Floating in debt, ridden with all sorts of problems, in June 1982 the Mexican government was forced to declare itself unable to repay the country’s foreign debt. Three months after it, during his State of the Union address on September 1st 1982, the President nationalized the banking system seizing all accounts in US dollars and blaming the Mexican bankers for the crisis. The problem is that even if it was a sound and much needed policy decision, the way in which López Portillo carried it, as a backlash against greedy bankers and to defend the Nation from a foreign treat, ended up creating more tension.

The decision was perceived by some sectors of the population as a step towards a greater interference from the government in the economy (meaning socialism or communism). Leaders of the private sector presented the measure as confiscatory and abusive. However, and interestingly enough, at the same time, the Chilean military government of Pinochet (hardly a Communist) was taking similar steps, so it was not about Communist López Portillo versus Capitalist Pinochet. It was a measure aimed at protecting their banking systems, the few assets still on them, and to protect the economy from future shocks. However, López Portillo inflamed rhetoric connecting his decision with previous nationalization experiences (the Oil in 1938 and the Electricity in 1960), made him an easy target of fierce critiques from the right. (You can find here an explanation of why it was necessary for Mexico's and Chile's governments to take over the banking systems).

Fortunately, López Portillo was at the end of his six-year term, so a new President and a new team took over in December 1982. The situation, however, continued to deteriorate. The cycle inflation-devaluation was on and the decisions of the government created more uncertainty, so there was a huge pressure to keep hiking prices. Foreign credit was hard to find, and Miguel de la Madrid presided over an intense power struggle within his cabinet.

Moreover, in 1985 a major (8.5) earthquake hit Mexico City. The earthquake, on the one hand, showed how fragile was the country’s economy and the problems that the federal government had to provide answers to situations like that. On the other hand, it was perceived as an awful display of the inability of the Mexican government to help in a crisis context. Moreover, it also created new needs as far as housing and the very reconstruction of the city were concerned, all of which was happening within the context of a relatively intense (although not as much as Brazil’s or Argentina’s) cycle of devaluation-inflation.

The Plans

That is why, at some point in the 1980s, it was unavoidable for the governments either to apply a “shock-plan” or a heterodox plan, the cornerstones of neo-liberalism in the region. The shock plans aimed at freezing at least temporarily the entire economy to try to induce a sudden stop to the (hyper)inflationary processes. That was the case of countries like Argentina and Brazil where the devaluation-inflation cycle reached the two or tree digits level. The “shock-plans” of the 1980s included a sudden reduction in the amount of cash available in the overall economy and/or the adoption of an entirely new currency (the shift from the peso to the austral in Argentina).

Mexico followed a heterodox plan since the government was able to control key prices of the economy (fuel, energy, public sector wages, etc.). The heterodox plan was labeled as the “Pacto de Solidaridad Económica” (Economic Solidarity Pact). The idea was, however, the same of the shock-plan although it was less damaging for the economy: prices will be fixed, unions will not seek increases, and producers will reduce their expectations.

This is the time when the wave of the so-called “neo-liberal” governments happened. In some cases (Mexico) the term was accurate since we had a cohort of relatively young politicians, with Carlos Salinas as their leader, with degrees in Economics from US universities who claimed to be heirs to the old Liberalism of Juárez ("social liberals" called themselves). However, the situation was not the same all over the region.

To be continued...

Oil Revenue, TV and Choice of Policies

Hi Class,

Today, as I was doing my daily readings of Mexican and Latin American newspapers I found a piece in the Mexican newspaper La Crónica about Venezuela. I think it connects nicely with some of the topics that we have considered during our sessions.

The piece (I cannot put a permanent URL because of the way Crónica builds its website, but I will copy and paste the entire piece at the end of this post) talks about the decision of the government of Venezuela to constitute the Unidades de Defensa Popular (Popular Defense Units).

The creation of these units is a small part of the larger project presented by Chávez's government in November 2004 (you can get the full PDF file of the document in Spanish here). There is where you can find, among many other proposals, the idea to create TV Sur (the "Latin American Al-Jazeera"), the Universidad del Sur (Southern University), and many other ideas. Of course, all those things cost money. Venezuela has it (so far) since it has been able to cash into the current market of expensive oil.

However, the question remains. Are those projects the best policies to deal with Venezuela's and Latin America's problems. I am not so sure about that. As far as the media is concerned it is important to stress the fact that unlike what happened in the Arab world when Al-Jazeera came to exist, in Latin America we have had previous experiences of pan-Latin American TV channels that unfortunately have been unable to succeed. As I mentioned in class one was Eco, a venture of the Mexican firm Televisa. One more recent is a channel launched by the Organización de la Televisión Iberoamericana (you can see their scheduling here). They are trying something that Eco did in their last years on air. They broadcast the local newscasts from all the countries in the region as they were originally produced in the countries of origin.

Here in the US it is possible to get in Dish Network something similar to that. It is called Sur (interestingly the same name that Chávez proposed for his network)

As I mentioned in class you also can get CNN en Español, which is much more conservative than its sister network CNN International, mostly because of the dominance of Cuban journalists based in Miami. One problem I frequently have with CNN en Español is that for the most part their news about Mexico are old by the time they air them here in the U.S., although that is a bias of my own condition as newsjunkie and also of the fact that in the U.S. you can get both major networks from Mexico (Televisa and TV Azteca, plus almost all the newspapers).

That is the key difference with the Arab world, in Latin America the main issue is not censorship from the national governments (with the exception of Cuba) but the interest that the national publics have (or not) in getting their news from a continental media outlet as compared to a national or local one.

Moreover, you have very powerful private media in countries like Brazil (O'Globo), Venezuela (Venevisión), and Mexico (Televisa). These media outlets have agendas of their own and they do their best to pursue them. In Venezuela's case the media and Chávez have been on opposite sides of the table for most part of Chávez's tenure as President, however, you cannot assume that the same happens all over the region with the rulers.

Moreover, the question remains if the governments really need to outspend the private media outlets when trying to present their ideas. How much it costs? Is that the best use for the money? Where can we draw the lines between information and propaganda both for the private media outlets and the media outlets owned by the governments? Those are some of the questions that Venezuela's case prompts.

Take as an example the case of the Universidad del Sur, Southern University (page 20 of the document). It is interesting to observe that Chávez locates that proposal at the same level (Continue to impulse the new multipolar international system) than his proposals to create Petro-América and TV Sur.

Do we really need in Latin America yet another University? I do not think so. There are actually plenty of them, most of them in great need of cash.

Why he is interested in creating a new one? Why he is not offering, as an example, additional funds to existing (Venezuelan or Latin American) universities? What are the reasons behind the idea of creating an entirely new institution? Political? Educational? Geo-strategic? Unwillingness to follow academic rules and procedures?

Moreover, it is possible to find similar proposals and policies in many countries in the region. In the case of Mexico City, the mayor (Andrés Manuel López Obrador) decided to create a new public university. Now, you may think wow, that is cool, not? after all education is a good thing, but then the questions that his decision brings are many:

Why a new public university in a city that already concentrates the best public (and private institutions) in the country?

Why a new public university when all the other public universities (Universidad Nacional Autónoma de México, Universidad Autónoma Metropolitana, Instituto Politécnico Nacional, etc.) in the city are facing severe problems with their finances?

Why not giving the funds to already existing public universities?

Why, on top of everything, his decision to neglect any requirement (like GPA or a standarized test) to attend this new university?

Moreover, the decision to create this new public university in the city (Universidad Autónoma de la Ciudad de México) contrasts with the unwillingness of the government of the city to share the fiscal burden of elementary and secondary education with the Mexican federal government, something that the rest of the states in Mexico do.

Ultimately, the question goes back to what are the specific choices, the policies, that the governments (national and local) all over the region are making, and what will be the consequences of such choices. Can we think that funding the Popular Defense Units, the "Latin American Al-Jazeera", or the Southern University are the best choices for a country living an oil-related bonanza?

If we take the lessons from the same Venezuela during the years of the first presidency of Carlos Andrés Pérez, Mexico during the years of José López Portillo (who also created a University in Mexico City, among many other things), or Ecuador during much of its recent history, the answer will be no. However, we cannot outrule any possibility at this moment.

The good thing about the Venezuelan case, for future analysis of it, is that Chávez is displaying a great deal of autonomy, of agency, in his choice of policies, there will be no way for him to blame, as the Argentinean peronistas like to do, the International Monetary Fund for the future outcome of his decisions.

* * *

Oposición acusa a Chávez de impulsar "milicias populares"
Notimex en Caracas
2005-02-12
La Crónica de Hoy, Ciudad de México

La creación de Unidades de Defensa Popular (UDP), anunciada por el gobierno venezolano, busca involucrar a la ciudadanía en "hipótesis de conflicto no tradicionales" con el fin de formar "milicias populares", advirtió hoy la oposición.

El vicepresidente del Frente Institucional Militar (FIM), Rafael Huizi, dijo a Notimex que la iniciativa responde a una nueva doctrina militar que "se pasea por hipótesis de conflicto no tradicionales" para comprometer a la población en la defensa de la soberanía.

"Estos cambios en realidad se iniciaron desde el comienzo del gobierno con la modificación del concepto de la seguridad nacional en la Constitución de 1999", afirmó el dirigente de la agrupación de militares retirados.

Huizi recordó que en la Carta Magna vigente se establece que la seguridad de la nación "no es de exclusiva competencia de la Fuerza Armada Nacional (FAN), sino corresponde a todos los ciudadanos".

Sostuvo que las continuas referencias del presidente venezolano Hugo Chávez a una eventual agresión de Estados Unidos, así como los cambios en la doctrina militar de la FAN y la creación de UDP, buscan formar "milicias populares similares a las de Cuba".

"Sería la aplicación de una guerra popular como en la que se entrenan los cubanos", afirmó el dirigente del FIM en alusión a los Comités de Defensa de la Revolución que estableció el presidente Fidel Castro.

En la celebración de su fallida intentona golpista de 1992 contra el entonces gobierno de Carlos Andrés Pérez, el presidente Chávez llamó a formar las UDP y a la vez advirtió sobre las consecuencias de una eventual agresión del "imperialismo".

"Si al imperialismo se le ocurriera meterse con Venezuela tendrían que verse con el pueblo de (el Libertador Simón) Bolívar que está dispuesto a defender su soberanía, su patria su dignidad, y su grandeza", advirtió el jefe de Estado.

"Allá en el barrio, en cada barrio, allá en la quebrada, allá en el campo, allá en la fábrica (...) en el núcleo endógeno, allí deben ir naciendo unidades de defensa popular", desde 10 hasta 500 o más personas, dijo Chávez ante miles de seguidores.

El gobernante venezolano anunció que asignará recursos extraordinarios para que las UDP "vayan naciendo y se sigan incrementando" y subrayó que asumirá directamente su mando y el de las reservas de la FAN, que estimó en 80 mil personas.

El ministro de Economía Popular, Elías Jaua, señaló en fecha reciente que el gobierno formará cooperativas agrícolas integradas por 147 mil "lanceros", campesinos a quienes se dará instrucción militar para que ejerzan la defensa de la soberanía nacional.

"Se va a dar capacitación militar como orden cerrado, maniobras militares, uso de armamentos y otras actividades propias en cualquier entrenamiento militar de una reserva en este y otros países", aseguró el funcionario en entrevista con un diario local.

Jaua agregó que la iniciativa "no debe ser motivo de alarma", pues "nuestra Constitución y la ley de la FAN estipulan el ejercicio de la reserva como un derecho y un deber de todos los venezolanos y eso es lo que ha venido aplicando este gobierno".

Desde hace cuatro años, dirigentes opositores y militares disidentes acusan a Chávez de pretender crear "milicias" al servicio de su "revolución pacífica y democrática" y de reorientar políticamente a la reserva para que sea fiel al mandatario.

"La revolución busca conformar un ejército paralelo, una milicia, pues Chávez desconfía de la Fuerza Armada", advirtió el general retirado del Ejército, Juan Herrera.

On Institutions as Habitus

Hi Class,

I know that Matthew must be tired by now of hearing or reading during three semesters about habitus, however, since he and Briann are the only veterans of previous courses, I think it is necessary for me to provide some information on Habitus. It is important for us because institutions do play a key role in shaping (either by promoting or preventing) social change.

Originally, Pierre Bourdieu developed the concept of habitus as a way to address the poverty of concepts such as class to explain, as master variables, conflict and social change. He, as many others realized by the early 1950s that one of the main drawbacks of Marxist theory of society was its assumption that people will conduct themselves based on whether or not they were or were not the owners of the means of productions.

He certainly acknowledges the fact that our place within the larger economic structure has a significant impact in how we interact with others (the realm of sociology), how we interact with the political institutions (the realm of political science), and how we interact with other agents in the markets (the realm of economics).

He came to realize that such interactions were largely mediated by our experiences in what he calls habitus. A habitus is a STRUCTURED AND STRUCTURING STRUCTURE, behind such truism he is trying to emphasize the fact that structures have a key role in shaping interaction and that they seek to reproduce themselves by creating other institutions, practices, and even traditions of their own.

Examples of such structures are the school we are in, the church we attend, the market in which we exchange goods and services, the family we belong to, and even the formal and informal groups (soccer teams, political parties, etc.) in which we participate.

Those structures are structured in the sense that they exist way before us (think of the case of the Nation State or the Church or even the School) and they shape us as much as the shape other individuals. More over, as in the case of the Church or the Nation State, as institutions they shape other institutions that will also have an effect on us. Think of the case of your birth certificate and because of it with your very identity as a US citizen. Think also how it connects at some point with, as an example, your first passport, your registration at school or your Social Security Number, and how the SSN will be later in your life connected with your taxes, with your eligibility to claim benefits, and so forth and so on.

That is why at some point in his works Bourdieu explains the concept of habitus by using the metaphor of a train that builds its own track as it advances.

Usually in my Intro or my Sociology of Sports classes, I use the example of language to explain this. Spanish, English, and any other language can be assumed to be habituses in which we are raised. Moreover, if I use English here such use will force me to use more English. If I switch to Spanish at this point and being this a course on Latin America, chances are many of you will be able to continue reading what I am writing.

Pero si en lugar de cambiar a español decidiera yo cambiar a francés o alemán, entonces las posibilidades de que la comunicación continuara transcurriendo entre nosotros serían significativamente menores.

Möglicherweise lesen etwas von Ihnen französisch oder deutsches, aber ich bin sicher, daß nur ein kleiner Anteil der Gruppe sie tun kann.

(Perhaps some of you read French or German, but I am sure only a small share of the group can do it.)

With political and economic institutions, something similar happens. Once they are created, they prompt new needs directly associated with them. That is how is possible to understand how certain features of Latin American politics (presidentialism as one possible example) engenders more institutions and practices associated with the presidential institution.

You can see that happening here in the United States too. Look at the formal and informal powers of the President. Look at the secretaries, departments, committees, commissions, task forces, and the like created by or to satisfy the needs of the presidential system. Moreover, compare the presidential institution here in the United States with similar institutions like the Crown in Britain or Sweden, or with the presidency in Germany or France.

In Britain, as an example, the existence of the Crown as an institution and the Queen shapes from the national anthem (God Save the Queen or, when a male is in charge, God Save the King) to specific practices in the Parliament, the press, the courts, and other institutions.

In France, on the other hand, the coexistence of a strong presidency and a strong prime minister offers a striking contrast with the strong presidencies in US or Mexico (lacking a prime minister or something similar) and the German or Austrian presidencies (weak, ceremonial institutions that have little or no power).

The same can be said of international financial institutions such as the World Bank or the Inter-American Development Bank. They certainly impose not only specific conditions as lenders (rates, periods, payments, etc.). While doing so they also have a say in shaping financial and political institutions in the countries where they have operations. There is no agreement as far as how interventionist they really are. Evidence from Mexico and Argentina offers contradictory results. While in Mexico the IMF-WB were willing to accept a heterodox or unorthodox structural adjustment, in Argentina we can see traces of a rather orthodox program as far as the privatizations is concerned.

The problem, of course, is that for Argentinean politicians is also easier to put all the blame on the IMF-WB (institutions with very bad rankings in the Latin American public opinions) than to assume that they could have gone with a heterodox approach on privatizations and with a more realistic program on the monetary side of their structural adjustment program. Or, something that is even harder for any politician in Argentina, Mexico or the U.S.: to accept that they simply made mistakes.

As far as Bourdieu is concerned, he defines at some point a habitus as “a product of history” able to produce “the collective practices and hence history, in accordance with schemes engendered by that history”. As it is possible to figure out the presidential institution (to follow our example, although there are many others) is a product of history, able to produce collective practices and hence able to produce history in accordance to schemes engendered by that history.

You can find a more detailed discussion of the origin of habitus and how it relates to the sociological or political concept of institution in this article by Omar Lizardo.

Bourdieu himself connected at some point his concept of habitus with the concept of institution in his book Homo Academicus. You can read an analysis of that book here.

A Little More on Comparisons and Orientalism

Hi Class

At this moment our course is heavily into comparisons. I know I did not convice Rosemary when she asked me why it was so important for us to go over comparisons and classifications of different regimes in Latin America.

I think I said something like because is the way we advance science and I really believe so. Later I wrote, also answering a question by Rosemary, that up to certain extent comparisons are exercises of orientalism. I even provided a brief definition of orientalism.

In our Monday session and also on during Thursday's we will plunge again deep in the sea of comparison. The reason to do it is because I think that the best way to avoid the implicit orientalism that affects many comparisons is not by rejecting the very possibility of developing comparisons, but by improving the way comparisons are done.

Think, again of the example I used about Argentina and Chile military regimes. How both can be blamed with many similar problems and abuses, and yet there are aspects of the Chilean military regime (stability, economic performance, ability to prepare Chile for other processes) that are necessary to take into consideration if we want to achieve a better understanding of the forces behind both Military Juntas, their policies, their outcomes, and also their legacies to the civilian regimes.

Think, as an example, of the advantages that the Chilean civilians have had when dealing with their country's transition, as compared to the kind of general bankruptcy that the Argentinean military government left as legacy.

Now, I am not trying to dulcify Pinochet's memory. I think that there is no way to justify the collective assassination of God knows how may Chilean citizens with ties with Allende's government. That was brutal and there is no way to justify it. However, is clear that the differences in the outcomes are relevant at many levels. Those differences exist also when we deal with democratic regimes: think as an example of a possible comparison between Uruguay and Costa Rica, or with authoritarian regimes (a comparison between Mexico and Brazil from 1960 to 1988).

Oil, Privatizations and Policies

Fátima wrote,
«My argument is that Ecuador's economic downfall has been a result of a devastating drop in petroleum prices, Ecuador's most important resource. Since then Ecuador's economic disability has led its banking system to collapse, a sudden change in its currency (from Sucre's to dollars) and an increase in unemployment as well as poverty.

«The country has also experienced an emergence of distinction amongst its indigenous people, to which they are trying to claim there rights to a share of the countries resources».


I replied:

But do not loose sight of the role of the military in the era previous to the drop of the oil prices. That is something that has hurt Ecuador very much. On the other hand you could argue, Why Ecuador is so dependent on oil? Isn't it?


Then Fátima wrote again:

«When you speak of the military govt, are you referring to their strong desire to control the oil investments and how they over estimated the role of ecuadors oil? If so, I will definitely incorporate that.

«Also, wouldn't the fact that oil has been an important product of Ecuador, in terms of bringing in income, acknowledge Ecuador's dependency on oil?»

And I replied:

Yes, but not only to that "strong desire" as you put it. You need to take into account the very instability that affected Ecuador during most of the 20th century, and more important the specific policies that the military and civilian governments of the 1960s and 1970s pursued.

Go to the Timeline in the CD-ROM and follow Ecuador's political history. You will see how, unlike other military regimes that brought stability to their countries, in Ecuador even military Juntas were very unstable. Now, the issue with oil is that you do not need to depend completely on it. Oil as any other commodity can be used to boost economic growth, to provide education, or to pursue other aims.

That is the main problem of Ecuador and Venezuela, and many other oil producers worldwide. With the oil revenue you can develop other sources of revenue. Look at Mexico. In the 1970s the country became totally dependent on oil revenue. After the 1982 crisis made evident that it was suicidal to do that, the Miguel de la Madrid's government introduced a series of changes to diversify the economy and to depend less and less on oil. Nowadays oil revenue is still very important for the Mexican government, but a drop in the oil prices does not kill the entire economy as it happened in the early 1980s.

Again, as I said with the case of globalization and military dictatorships it is necessary to look at the details, and not to assume that one feature will be able to determine the performance of the entire economy or the whole country.

The key question with oil in Ecuador, Argentina, Venezuela, or Mexico is what the governments are doing or did with such a precious resource.

In Argentina’s case, as an example, the ideological application of neoliberalism (ideological in the sense that it was blind to specific features of reality) made them put each and every asset on sale, a gigantic garage sale that, of course, ended up in the tragedy that you can see there now. Today, they are trying to rebuild a public sector, but of course, they are strapped for cash because they are still trying to renegotiate their agreements with the US.

In Mexico’s case we had many privatizations: phones, newspapers, TV stations, etc., but the Oil company was never even mentioned as a possibility.

Venezuela tried to follow a pattern similar to that of Mexico, so that is why up until now there is no talk of privatization of PDVSA, although there you have a different set of problems.

In Ecuador all those things that you talk about happened, but they happened within the context of a specific government (very unstable, lacking a long term project, etc.). Where, as an example, is Ecuador's oil revenue? Schools? Roads? Military equipment? Health services?

You can do similar comparisons with, as an example, the phone companies: Why Mexico’s Telmex is nowadays a major player in the region’s sector while Argentinean firms are down the drain? Well, because Mexican privatization followed different assumptions. It was very unorthodox or heterodox if you want, it preserved the monopolistic nature of the firm (and that of course makes angry many people in my country), but at the same time you protected jobs, investments, and avoided the carnage that happened, as an example, in Argentina.

But also in Mexico we had very bad privatization processes, as it was the case of the banking system. Nowadays there is only one major Mexican bank. The rest are local branches of either US, Spanish, or Canadian banks. But then again, the major problem was not privatization by itself, but how the owners of the newly privatized banks carried their businesses, because again, you still have one Mexican bank that was able to survive that carnage.

So, again, look at the specific problems and the specific policies. Do not assume that there is one single feature (globalization, neoliberalism, privatization, military dictatorships, communism, etc.) that explains each and everything happening in the countries. That is fine if you are running for major of Buenos Aires, Mexico City or Caracas, but if you are doing academic research, you really need to understand what specific forces are shaping the processes you are analyzing.

Regime Classification, Comparisons and Cleavages

Hi Class,



Fátima is very active writing to me, and I am very happy answering her questions (or at least doing my best) so here are some additional questions followed by my answers:

* Would my topic still stand although it is a generalization. Of course I would speak of the importance of liberties to Latin Americans but I do not want to get into the political issues between cuba and the US, or should I? Or would it be less broad if I concentrate on just one case(country) and its social and civil issues.

* Would it be best to compare Cuba before Fidel and the present with Fidel, such that I compare the social and economic changes without referring to the citizens preferences. I can incorporate the US relations with Cuba without encompassing the entire paper of their sticky relationship. Or should I stay away from Cuba?

* My interest stems from the documentary, and I just feel that covering all of Cuba-US's relationship will take over my paper, I want to deal with the socioeconomic changes within a country that come from govt changes, is there a country that would better suit this topic.

The problem with Cuba is that there is no way to put the confrontation with the US government aside. All over La Habana, Santiago and any other city you can see the traces of the confrontation. You can see it from Mexico or form the Dominican Republic. It is a bleeding wound and many actors profit from it: Cuba's totalitarian government, the US imperialist foreign policy. Moreover, it definetely shapes preferences and choices of individual actors outside and inside the Island. It shapes programs like Radio Martí and all the phony (to say the least) "fellowships" that some leaders of the Cuban opposition receive from rather hard to identify foundations here in the States (Have you seen Oliver Stone's documentary and interview with Fidel?).

I am sure that in many cases (I know specific persons in Mexico, as an example) that will be willing to trade-off freedoms for a Welfare State, but the specifics must be reviewed on a case by case basis, being aware that generalizations at a regional level are hard to support, unless you have very specific information.

Now, I am not denying the value of your argument. I can see it even here in the States (you can say that such happens also here in the US with the very intrusive monitoring of activities of groups seen as "dangerous" by the US Department of Homeland Security), I am just saying that you need to be aware of the national differences.

Any comparisson is plausible and possible. Cuba and Mexico, Cuba and the Dominican Republic, Cuba and Argentina. Cuba pre and post-Fidel. The issue here is availability of information. How much info do you have on pre-Fidel Cuba? How much would you be able to gather from here until, one month?

The question is more Are you really interested in Cuba? If so, go for it. If you only have a marginal interest on Cuba (and perhaps that is why you do not want to deal with the US-Cuba rift) then do not go there, because there is no way to understand how people in Cuba deal with the regime if you do not take into account the US-Cuba quarrel.

The US-Cuba relation is a critical feature for any research dealing with Cuba, no matter if it is sport, religion, family or any other topic. I do not think that you should be worried about touching ground on it. You can dedicate two pages to that issue as a part of the context and that is it. You do not need to re-do the history of the US-Cuba conflict. There are excellent summaries already available for that.

For all countries you will be able to find topics like that, that are crucial to understand that country. Lets say, if you are writing about Mexico you cannot avoid talking about the 70 years of government from one-single party. If you do it about Argentina you cannot avoid talking about the Partido Justicialista (Peronismo), and so forth and so on. You can think of these topics as cleavages. Political Scientists use that concept to talk about issue that divide deeply a country: Church-State relations in Mexico, Spain or Italy; abortion in the case of the US; the US in the case of Cuba. For any country you can find a topic like that, a topic that is so central that yes, it looks as if it could take over a paper on other topics, but is not a forced outcome, you can control that.

Again, any country, any combination of countries is fine. You just need to say the word: Cuba, Dominican Republic, Mexico, Argentina...

Ah, and of course, for any country in the region you can find evidence of that connection, and also of the trade-off freedom-goods/services, but you need to consider it within the specific context of that country.



A final word on cleavages.

The paper Cleavages by Stefano Bartolini of the European University Institute, offers a good introduction to its use and gives you a sense of how you can apply it to different topics.

More About Regime Classification

Hi Class,

Fátima Santana sent me a question about her paper, I think that my answer can be relevant for all of you.


Fátima's question:

I am very interested in Cuba and was hoping to compare their Socialist regime to that of another LA country that is more democratic. Since I believe that although cubans are stripped of many civil liberties their new govt has infiltrated many social programs, whereas in a democratic LA country they are given civil liberties but are stripped from their social programs, a major reason why many L Americans would rather have an authoritarian govt.


My answer:

Very interesting. There is a good chunk of empirical evidence supporting that claim. Check the polls by Latinobarómetro. Of course, the problem remains. Freedoms are also cherished by many Latino Americans.

Just do not fall in the trap of essentializing Latin American "identities" or "culture" with authoritarianism. That has been done many times and I think is very unfair and misleading, because the problem is that even in authoritarian regimes that were very effective in providing opportunities up until the end of the 1960s, the tensions brought by the confrontation between those claiming more civil rights and liberties and the regime were just too much. Look at the cases of Mexico, Argentina, Brazil, and even Uruguay. If people had been just willing to accept the trade-off, then the Tlaltelolco Massacre would had never happened.

Later, in the 1980s, many of us Mexicans were aware of how efficient the PRI was to provide a series of goods and services that no other government in Latin America was able to provide. Moreover, we had no experience of a "dirty war" at the scale that, lets say, Argentina or Chile lived. And yet, in spite of it, there were large sectors of the Mexican society willing to mobilize to democratize the country. Among many other reasons, because authoritarian regimes are good to spread some benefits, but they are also ridden with corruption, abuses, and irrationality that--at least theoretically--you can control through democratic institutions.

Moreover, I would say that in the case of Mexico the authoritarian regime of the 1960s was trapped by its own democratic discourse, because that is another feature of authoritarianism it is extremely fragile and can only justify itself by claiming to be a temporary, would I dare to say extra-ordinary solution, while the country gets ready to other forms of political regime. That is a constant from Mexico to Argentina, and from Chile to Cuba.

Also, be careful when dealing with the Cuban case. You must be aware of the role that US interventionism plays there. That, by itself plays an extremely big role in shaping choices and preferences of Cubans, because there is a real threat of military aggression by the US expressed in the very use of its soil to house the military base at Guantánamo, or the Platt Amendment, just to name the two most obvious features.

I think that is necessary to go on a case by case basis. Also, because not all authoritarianisms are the same: if you compare the Mexican PRI'ismo of the 1950s with that of the 1990s there are plenty of differences, and the same happens for most of the countries, perhaps with the exception of a personalist dictatorship like that of Stroessner in Paraguay. That is why the readings on regime classification are so important for us, because when we hypothesize about how specific forms of government shape choices and preferences is important to be aware of the differences between regimes. Otherwise you come up with these broad and almost meaningless generalizations about authoritarianism or democracy and the so-called "political culture" of the countries.