August 7, 2009

TAKE OUT THE CASTRO'S AND HUGO AND LET THE GOOD TIMES ROLL:

Mirror Image: Latin America isn't tilting left, it's tilting right. (Mac Margolis, 8/07/09, Newsweek)

Despite the financial meltdown and for all the lather over neoliberalism, young Latin Americans are still in favor of free-market capitalism. In a PODER/Zogby poll commissioned earlier this year by NEWSWEEK, 63 percent of Latin Americans ages 18 to 29 said they believe that free trade is not only good but "benefits all people." The same number saw Colombia's FARC guerrillas as terrorists or drug traffickers, and two thirds named Chávez as the leader worst suited to lead the region in the future. That doesn't mean that Latin America is veering right again, but it may just be learning to cherish the middle ground.

Consider Alan Garcia, the guitar-playing enchanter who nearly wrecked Peru with his checkbook populism in the late 1980s. Now he's back, but this time as the poster boy of international investors—and reaping the results. Peru's economy is on track to expand by 2.5 to 3 percent this year and 6 percent in 2010; mining stocks have doubled in value on Lima's BVL bourse since January. In Chile, Bachelet's Socialist Party publicly disses neoliberals and the Washington Consensus, but in office she has abided by their rules and kept to the no-nonsense prescriptions of the center-left coalition Consertación. Although she has pumped money into social programs, she has taken care not to rock the broad consensus in favor of the free trade and fiscal conservatism that have kept Latin America's most vigorous capitalist economy on course.

In Brazil, Lula swapped his sweaty denim for tailored suits, broke bread with investors, and paid down the country's debts religiously, and though he is beginning to spread perks and pork again (with an eye on next year's election), his government still boasts one of the most conservative monetary policies on earth. (The central bank's prime lending rate is 8.75 percent a year.) Everyone but Brazil's factory-fitted leftists is delighted. Lula has an enviable 80 percent approval rating.

Even Fernando Lugo, a left-wing priest who was elected president of Paraguay vowing to take land from the rich and give to the poor (and to nationalize foreign firms), has been as quiet as a monk. (Credit here goes, again, to Lula, who bought off the Paraguayans by throwing them more money for the energy Brazil buys from the Itaipu hydroelectric plant.)

Three countries in South America—Chile, Uruguay, and Brazil—will hold elections in the next 17 months, and yet in none is the ruling left-wing party favored to win.

Posted by Orrin Judd at August 7, 2009 8:46 AM
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