The Values of Free Enterprise versus the New Populism in Latin America
Braun, Carlos Rodríguez, Independent Review
Like pornography, populism is hard to define, but we know it when we see it. And what we have seen in Latin America is a succession of often unstable populist governments that face delegitimization more clearly and in shorter periods. My conjecture is that Latin American populism may enter into a new transformation in order to achieve more stability and will not seek that transformation in the more aggressively antiliberal alternatives such as Chavism and even less in dusty Castrism. It might approach liberalism,1 but its doing so would be unprecedented because all types of populism have been hostile to liberty up to this day. It is sadly more likely that Latin American politics will not embrace the cause of liberty, but rather the interventionist flag of the welfare state.
Populism has shown time and again that it gives birth to expectations it cannot fulfill. In addition, its failure is visible in briefer intervals (Cammack 2000, 152), a critically damaging circumstance for populism because if something approaching a theory of populism were to be sketched out, it would stress precisely die regime's relation with time, torn as it is between its leaders' demagoguery and what Guy Hermet calls "the rash impatience of its clients" (2003, 11). This urgent time preference, dangerous for politicians and destructive for the economy, appears also when interventionism adopts an institutional shape, as in developed democratic countries, but with one difference: populism is linked to specific persons, sometimes bearing their names, and accordingly ties its fate to these persons' vicissitudes, habitually more convulsion than the evolution of political systems that remain broadly unaltered when the government leaders succeed one another. Populism's luck will depend on this institutional leap.
Populism's self-destructive character is so undeniable that attempts to interfere with markets in the old populist style (through nationalizations or price controls) bring discredit from public opinion. There is, accordingly, a learning process, whose consequence is that today Latin Americans value a country such as Chile, which apparently has profited from experience, more than a country such as Venezuela, and they respect more the leaders in Santiago, Bogota, Brasilia, and Mexico City than the ones in Caracas, La Paz, Managua, Buenos Aires, and Quito (Dornbusch and Edwards 1991, 12; Isern Munné 2004; Valenzuela 2006; Walker 2006, 44). Even more clearly, they have shown recently, by voting with their feet, that they appreciate Spain, to which for the first time in history they have migrated in waves. The fact that the tax burden associated with the onerous welfare state amounts at present to approximately half of gross domestic product (GDP) and did not fall below 40 percent in the years of the so-called neoliberal José MarIa Aznar is not taken into consideration, rejected, or criticized. If such esteem diminishes in the future, it will do so not only because of taxes, but also because of the combination of higher taxes and doubts about the system's sustainability.
The fiction of neoliberalism, understood as a regime that reduces much of the state's weight and opens the way to private entrepreneurs in a market economy, held full sway also in Latin America, where some governments in the 1990s were said to have submitted to a sort of liberal populism. In this article, first I explore this liberal populism, which was more populist than liberal and did not escape classical populism's contradictions. Next I compare populism's interventionist policies with the policies followed in the democratic developed nations, which are not so different, as public opinion and academics often believe. Consideration of both misunderstandings allows me to conclude with a look at populism's transformation in Latin America in the search for more economic and political stability and at liberalism's potential to counteract the new democratic and antiliberal populist message. …