The New Latin America. Manuel Castells
growth. Nevertheless, the success of neo-developmentalism followed from two premises that were soon shown to be fragile: first, that global demand for commodities would continue to increase; and, second, that the prices of these commodities would remain high. Reclaiming its redistributive role through new policies, the state could avoid opposition thanks to the fact that society remained active, was increasingly informed, and significantly increased its participation in consumption.
The Crisis of Neo-Developmentalism
Almost all countries in Latin America were unable to engage in a complete informational transformation of their economies and societies, one that would have led, for example, to the transformation of research, higher education, and policies for the promotion of innovation. This inability meant that the growth of the region’s economies remained almost entirely dependent on exports from the extractive sector. As soon as China’s growth slowed and the prices of commodities fell, Latin American economies revealed their vulnerability to the fluctuations of the global economy. Even Brazil, the region’s most diversified economy, did not have sufficient knowledge to change its export patterns and add value to goods and services. While Latin America largely learned to manage financial volatility, it has not been able to do the same with the volatility of trade. As a result, Argentina’s economy, for example, fell 2.5 percent in real terms in 2014, and the same happened in Brazil in 2015 (−3.5 percent), while rates of growth slowed considerably throughout the region, except in Bolivia and Peru. 2015 was the first year of the twenty-first century in which the Latin American economy did not grow. While governments for a time continued to engage in high levels of public spending (something fundamental for social stability), the renewed threat of inflation, poised to exceed economic growth, forced these governments to impose austerity, especially the administration of Dilma Rousseff in Brazil in 2014. This undermined the popularity of governments in Brazil, Venezuela, and, to some extent, Bolivia and Argentina. Neo-populist governments won electoral victories but by ever smaller margins and with decreasing legitimacy.
Moreover, the neo-developmentalist model of development was based on the maintenance of economic growth and redistribution at all costs; it focused on the development of productive forces and on the improvement of the material living conditions for populations, especially for their poorest members. This productivist model ignored the environmental and social costs that it entailed. Enormous metropolitan areas became barely hospitable for most of the population, with rates of urbanization above 75 percent in the majority of Latin American countries. The conditions of housing, transportation, urban recreation, pollution, and the environment all deteriorated rapidly. While traditional measures of human development (health, education, and salaries) improved, a model of “inhuman development” arose and negatively affected the quality of life of most of the population. The criminal economy, brutal violence, pervasive crime, and the terror caused by gangs became the most significant problems affecting everyday life in every Latin American country. The media contributed to public panic, covering atrocious threats to daily life for ordinary citizens. Political corruption contributed to a shared sense of defenselessness.
At the same time, the consolidation of statist regimes, controlled by powerful political parties, led to the formation of a patrimonial and corporate state in which access to public businesses became a source of wealth, influence, and power for neo-populist movements, leading to widespread corruption in the political systems of almost all Latin American countries. The tradition of transparency characteristic of democratic politics in Chile was questioned, as networks of corruption were exposed both among conservative politicians and among those of the Nueva Mayoría (or New Majority, formerly the Concertación). This scandal even reached the family of President Bachelet, undoubtedly a moral person.
In addition, the state’s vast powers were shored up in several countries through the repressive strategies implemented by police forces (sometimes with help from foreign countries), which developed into bureaucratic actors whose presence could be felt throughout societies. New generations – raised in democracies, educated, informed, and used to communicating on the internet – resented the crushing presence of the patrimonial state. Statism could not stifle the ethical demands and demands for freedom put forward by young people participating in various social movements.
Figure 1.3: Distrust of Institutions: Totals for Latin America, 2002–2017 (%)
Note: Totals of responses expressing little + no trust
Indeed, public distrust of institutions is on the rise in almost all countries in the region (see figure 1.3). In 2016, the proportion of citizens who expressed distrust in both political institutions and the state was at least 63 percent, except in Uruguay, where the proportion drops to 51 percent (ECLAC, 2018a).
The convergence of the critique of inhuman development, the denunciation of state and political corruption, and the worsening of living conditions caused by economic stagnation and the politics of austerity triggered a rise in social movements in several countries, especially Brazil, Venezuela, Nicaragua, Chile, and Mexico. These movements directly challenged political regimes and their policies, and their demands focused on alternative forms of political representation.
Originally, these movements – in 2013 in Brazil, for example – were spontaneous and represented a younger population, which called for better societies. But they were soon joined by other middle-class sectors worried about the loss of their benefits, as in Venezuela or Brazil in 2015. Societies were broken apart, and the legitimacy of neo-developmentalism and its agent, the state, gradually dissipated.
In 2015, Latin America entered a period of economic uncertainty and political instability. The new social structure formed during the period of growth during the 2000s ceased to correspond to the political agents who had reached positions of power thanks to their fight against neoliberalism. Latin America lived through conflicts and contradictions during the first decades of the twenty-first century, overcoming both neoliberalism and neo-developmentalism. In this way, the region was led into a multidimensional crisis. This consisted of three interrelated crises: a crisis of neoliberalism, a crisis of neo-developmentalism, and a crisis of political and institutional legitimacy resulting from the failure of both of these models.
Neoliberalism exacerbated inequality, which was not remedied by neo-developmentalism. For its part, neo-developmentalism exacerbated statism and thus corruption, because interests moved from the market to the state. The political system’s crisis of legitimacy extended to institutions, causing lasting conflicts among groups wielding power, which enlisted judges and the media in their fights with one another. The absence of mechanisms for the aggregation and institutional negotiation of interests led to a complex crisis. This crisis is not essentially economic, given the region’s dynamic integration into the global economy; nor is it essentially social, given that in the majority of countries poverty has been reduced, together with extreme poverty and even inequality. It is a crisis of values and a generalized crisis of confidence, one that has led to a sordid and lasting conflict between actors, to the breakdown of any kind of consensus, and to the absence of shared rules of engagement.
Moreover, a symbiotic relationship between the logic of institutions in crisis and the logic of the rampant criminal economy heightens uncertainty. The state’s infiltration by drug traffickers emerges as a national problem, but even more so a regional and local one, not only in Mexico, Colombia, or Peru, but also in Brazil.
And thus, on this historical basis, various national situations intersect, in a set of multicultural transformations in public space and communications. It is, however, in the political system and in the state that the crisis is concentrated, and it is here that the limits of the new Latin American reality are becoming apparent.
Notes
1 1. For more detail, see BID (2016).