Why should Europeans pay attention to Bolivia?

Kepa Artaraz

Earlier this week Spain’s credit rating was downgraded yet again, reigniting fears that the Eurozone crisis that never left might in fact accentuate and force the fourth biggest economy in the Euro to go cap in hand to the International Monetary Fund (IMF) for a bailout. 

Ever since the Lehman Brothers bank went belly-up in 2008, signalling the beginning of the biggest global financial crisis since the collapse of Wall Street in 1929, there have been fears of a disorderly breakup of the European monetary union and of an unprecedented economic catastrophe.

Cue in, the international financial institutional architecture, mobilised, along with national banks. They have effectively ‘nationalised’ the bad debts incurred by private investors in a weakly regulated banking sector and transferred these to the balance sheets of sovereign states. As if magic, we are all now in this together and what was once private debt is now everyone’s debt.

The IMF might have changed a lot since the 1980s when it acted as the exporter of the neoliberal ‘shock doctrine’ to indebted countries like Bolivia.[1] It might even have come to realise that employment, equality and social justice lie at the heart of any project of economic recovery.[2] And yet, the austerity medicine being dished out is the same as it was then, austerity that results in falling salaries, reduced pensions, cut welfare services and unemployment for increasingly impoverished masses.

Some have argued that neoliberalism is dead precisely because the taxpayer has had to rescue the banking system.[3] In fact, the paradox is that a financial crisis created by neoliberalism is being ‘solved’ by deepening its reach and privatising the remaining bastions of the welfare state.

The current financial crisis might have different origins to the one that afflicted Latin America in the 1980s but its results in the form of sovereign debt and conditionality-driven ‘rescue’ plans look startlingly similar. As the social pain increases, what are the populations of Greece – or Spain for that matter – meant to do? Venting their anger through the ballot box offers little reassurance since all mainstream political parties are wedded to operating within the same system. Are we forever condemned to the dictatorship of the market?[4]

Not necessarily. The last four years in Europe have seen a certain democratic rebirth in the form of citizen movements that would have been unthinkable only a decade ago.  From Spain’s indignados (the indignant) to Greece’s aganaktismenoi (the outraged), to the growing numbers in the ‘occupy’ movement, spontaneous civil society movements unattached to existing political parties are starting to find their voice and demand the right to play a part in the creation of alternative societies.[5]

Given the lack of apparent grand, alternative narratives to neoliberalism, we are forced to look for the budding, small scale alternatives that are growing around us. Bolivia, where resistance to the social suffering caused by the neoliberal revolution began in the 1990s, can provide a few useful lessons and visions of what the future might hold for us. For, in the process of implementing popular responses to neoliberalism’s worst excesses, Bolivia and other Latin American countries have had a head start that is decades long. [6]

It is a well established position in the literature that, by the end of the 1980s, the levels of human suffering being dished out by neoliberalism in Bolivia led to popular discontent, effectively sowing the seeds towards grassroots mobilisation in favour of the current process of change.[7]

At the same period of time following the return to democracy, a crisis of what Bolivians have referred to as ‘partidocracy’ took hold of political institutions that, mired in corruption, were unable to represent and channel social demands. Once the masses reached the conclusion that political parties were in fact part of the problem and liberal democracy became a byword for illegitimate rule by the few, a new set of political actors stepped into the void to create new democratic spaces.[8]

Trade unions, the unquestioned political actor in their opposition to military governments had been decimated by the neoliberal revolution and by decree 21060. The political vacuum left by their loss of influence was filled the social movements. In this way, social movements became the historic agent for the refoundation of Bolivia, acting beyond simple opposition to provide alternative visions to the existing hegemonic model of politics as representative democracy; society, in the form of a society that excluded a majority of its indigenous citizens; and economy, as represented by the neoliberal order.[9]

Civil society represents the reconstitution of the collective political activity of Bolivian society and every sector of society was incorporated to become part of a process of change that began with the emancipation of indigenous peoples and their constitution as political actors. The indigenous marches of 1990 and 2002 were key milestones in this process and have been most clearly associated with the demand for a constitutional assembly.[10] This became most clearly articulated at times of national crises and popular uprisings that had common roots against the privatisation of natural resources – as was the case with water and gas in Cochabamba and El Alto during the crises of 2000 and 2003.[11]

These crises led the Bolivian population to accept indigenous demands for a constitutional assembly, a process of debate and deliberation that incorporated every sector of society, with the mandate to write a new constitution. Thus, during a process of national crisis brought to a head by the dual economic and political failings of neoliberalism, the constitutional assembly was presented as the mechanism that could deliver a resolution to this crisis by creating a roadmap for a new Bolivia on the basis of new sets of values and purpose.[12]

The story of Bolivia’s political change since then is one of miracles and frustrations in equal measure. Who in 2000 would have thought that an indigenous coca grower could become President five years later? Who could have predicted that by 2010 the traditional political parties would have all but been obliterated from the new plurinational assembly?

In spite of its limitations, Bolivia’s constitutional assembly constitutes a unique democratic experiment. The final text promises to change the country’s political sphere, by introducing a range of levels of decentralisation and a new relationship between the social movements and the state. It also redefines the relationship between the individual and the state, re-establishing the role of the state in guaranteeing social protections, integrating excluded majorities, and incorporating their traditional forms of knowledge.[13]

The constitution also proposes to regain for the state a dominant role in the country’s economic steerage whilst incorporating a plurality of forms of economic practice and property ownership that suggest the possibility of a future post-neoliberal paradigm.[14] Finally, the constitution also denounces imperialism and promises to redefine international relations, accepting the existence of interdependencies between regions and countries – just as between individuals – and building on these interdependencies through values of solidarity to deliver better futures for all. ALBA represents this collaborative experiment and a glimpse, perhaps, that better worlds are possible.

Whilst the new constitution was written and eventually approved by the Bolivian people, the political process before, during and after the production of the constitutional document provided a glimpse of the difficulties involved in renegotiating national values and power relations in a highly divided society. The 2008 political crisis following the Porvenir massacre has been followed by the current malaise that erupted with government plans to build a road through the TIPNIS national park. In between lie accusations of top level political corruption, a government that is too cosy with multinational corporations and, in spite of its anti-neoliberal and climate change rhetoric in the global stage, unable to think of development in ways that go beyond the extractivist model.

What then, is left of Bolivia as a ‘resistance movement and counter hegemonic project’ in the Latin American Region?[15] Does Bolivia in any way show European countries an image of their own future? In spite of noticeable progress in economic growth, poverty and inequality reduction and the introduction of a basic social safety net, the jury is still out on the long term potential of the current Bolivian constitution to deliver its promise in the context of long-term social cleavages. On the other hand, Bolivia’s ability to deliver political renewal and new leaderships through a healthy civil society is perhaps the best guarantee that the process of change will not become stagnant in the near future. The biggest legacy from Bolivia’s resistance to neoliberalism lies precisely in the possibilities offered by this kind of politics to give people the right to make their own decisions and commit their own mistakes.

Kepa Artaraz is lecturer in Social Policy at the University of Brighton. His book, Bolivia: Refounding the Nation, was published by Pluto in April 2012.


[1] Klein, N. (2007) The shock doctrine: the rise of disaster capitalism. London: Allen Lane.
[2] Stiglitz, J.(2011) The IMF’s change of heart. Al Jazeera, 7 May 2011. Available on http://english.aljazeera.net/indepth/opinion/2011/05/20115712428956842.html [Accessed 19 May 2011].
[3] Mason, P. (2009) Meltdown: The end of the age of greed. Verso: London.
[4] Younge, G. (2001) Democracy is no match for market power. Guardian Weekly, 08.07.11, pg 19.
[5] Douzinas, C. (2011) In Greece, democracy is born. Guardian Weekly, 24.06.11, pg 20. See also Carrión, M. (2011) Camp Sol: Spain’s ‘indignant’ give lessons in true democracy. Available on http://www.naomiklein.org/articles/2011/06/camp-sol-spains-indignant-give-lessons-true-democracy [Accessed 4 June 2011].
[6] Arze, C. and Kruse, T. (2004) The Consequences of Neoliberal Reform. NACLA Report on the Americas 38(3): 23-28.
[7] Khol, B. and Farthing, L. (2006) Impasse in Bolivia: Neoliberal hegemony and popular resistance. London: Zed Books.
[8] Prats, J. (2005) Bolivia tras el fracaso de la democracia pactada. Corte Nacional Electoral. Revista Agora, No. 3, September 2005, pp. 4-5. 
[9] From Torrez, Y., Ayo, D., and Velásquez, J-C. (2007) Agenda de la Asamblea Constituyente. Cuadernos de Diálogo y Deliberación. La Paz: Corte Nacional Electoral.
[10] De la Fuente Jeria, J. (2010) El difícil parto de otra democracia: La asamblea constituyente de Bolivia. Latin American Research Review, special issue entitled ‘Living in Actually Existing Democracies’, pp. 5-26, pg 8.
[11] Assies, W (2001) David vs. Goliat en Cochabamba: los derechos del agua, el neoliberalismo y la renovación de la propuesta social en Bolivia. T'inkazos, 4 (8): 106-134. Olivera, O. and Lewis, T. (2004) Cochabamba! Water war in Bolivia. Cambridge: South End Press.
[12] Stefanoni, P. (2002) El nacionalismo indígena como identidad política: La emergencia del MAS-IPSP (1995-2003). Available on www.clacso.org.ar/ar/libros/becas/2002/mov/stefanoni.pdf [Accessed 15 April 2010].
[13] Asamblea Constituyente (2008) Nueva Constitución política del estado. Versión oficial. La Paz: Representación presidencial para la asamblea  constituyente (REPAC).
[14] García Linera, A. (2008) Del neoliberalismo al modelo nacional productivo: Los ciclos de la economía Boliviana.  Revista de Análisis, 22 June 2008; García Linera, A. (2008a) El nuevo modelo económico nacional productivo.  Revista de Análisis, 8 June 2008.
[15] Robinson, W. (2008) Latin America and Global Capitalism. Baltimore: The John Hopkins University Press, chapters five and six.

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