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Friday, January 19, 2007

Bolivia's Growing Regional Conflict
James S. Henry and Donald K. Ranvaud

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Genimageaspx The new year is already off to a turbulent start in Bolivia. During the week of January 7 to 15, up to six thousands supporters of President Evo Morales' MAS party-- mainly cocaleros from the Chapare coca-growing region,  campesinos, and indigenous groups --  showed up uninvited in Cochabamba,  Bolivia's third largest city of 800,000,  in the country's center. 

024n2mun1_mini They had come to demand the resignation of Cochabamba'sManfred_reyes_villa_s_1   right-wing Governor, Manfred Villa-Reyes, who has become an outspoken leader of the "autonomista" movement since his election in December 2005. This movement is seeking greater "states rights" for the country's nine provinces, especially the wealthier, whiter provinces of Beni, Pando, Santa Cruz, and Tarija in the south and east, where most of Bolivia's natural gas and richest farms are located.

070111_bolivia_3_1 As shown in the accompanying exclusive video footage from Cochabamba (Parts I, Part II). shot by Bolivian film crews working under the direction of Donald K.Ranvaud (Constant070113_paz_cochabamba_3 Gardener, City of God, Central Station, etc.), the MAS supporters encountered a fierce reaction from the city's middle-class residents and pro-autonomista forces.

These included a crowd of more than 1000 well-organized stick-waiving militants who attacked the cocaleros and campesinos aggressively on January 13th. In the ensuing conflict, at least two people were killed and more than 150 were injured.

By Saturday January 14th, calm had returned. Manfred came back from Santa Cruz, where he had fled out of fear for his own safety, and  Morales returned from Nicaragua, where he had been attending Daniel Ortega's Presidential inauguration. Steps were taken on all sides to pacify the situation -- including the deployment of the Bolivian Army.

Bolivia_map However, as we'll discuss below, the potential for renewed conflict is very high.

This is not only because none of the fundamental economic and political causes of the conflict have been addressed.  It is also because Bolivia's political leaders on all sides have not exactly shown the maturity and capacity for compromise that will be essential to avoid a "lose-lose" outcome. 


035n1mun1_mini Regional tensions have been building up in Boivia for several decades. The potential for conflict is explosive because it is closely aligned with many other deep-seated social fault-lines – the distribution of natural wealth; poverty and education; the concentration of organized communities like the cocaleros, indigenous groups, and obreros; and the distribution of support for parties and organizations like PODEMOS, Manfred Reyes-Vlla’s NFR, and “Nacion Camba” on the Right, and MAS, the cocaleros, the campesinos, the Central Obreros, and the social movements on the Left.

F130107i10 One crucial factor is that Bolivia’s most valuable natural resources, arable land and natural gas (and the refineries, pipelines and agribusiness facilities needed to exploit them), are concentrated in Bolivia’s wealthier eastern and southern states. Together Tarija, Santa Cruz, Beni, and Pando account for just 30 percent of Bolivia’s population, but more tha two-thirds of its natural wealth. While MAS has captured a third of the vote in Santa Cruz, Evo’s poorer, more indigenous (“Kolla”) base is much stronger in the five western states. In the state of Cochabamba, a key battleground in the recent crisis, Evo’s party controls 12 out of 14 provinces, and has been pressing hard to oust Manfred.


The regional conflict has recently come to a head for several reasons.

Bolivia_brazil_pipeline First, since Evo's election in December 2005,  he has been asserting greater federal control over land, natural gas, and tax revenues.

He has also renegotiated Bolivia’s gas export contracts with Brazil and Argentina, tripling the revenue that the country realizes from its gas exports. Under Bolivia’s current federal system, at least 40 percent of this increased revenue will go to the states.

Map Ironically enough, the “Camba” states –- which were heavily subsidized by the “Kolla” ones before gas and soybeans took off in the 1970s and 1980s -- have benefited greatly from MAS’ new economic policies. But this has not led them Camba states to support Evo – if anything, it has increased their desire for secession.

Evo has also launched a tough new anti-corruption campaign – one of the most aggressive in Latin America. Focused on increased transparency and accountability for government spending, this is intended to address the long-standing popular conviction that a large share of Bolivia's Treasury ends up benefiting powerful private interests. It is also designed to insure that any increased gas revenues will be used wisely.

The program is very popular with ordinary Bolivians, but it has not won Evo many friends among the state bureaucracies, the diplomatic corps, and politicians – for example, Governors like Manfred, who has often been accused of corruption, and of being a lackey of Delozada_1 former President Goni Sanchez de Losada -- whose extradition from the US on "genocide" charges is about to be requested by Evo's government.

Third, in August 2006, Evo convened a “Constituent Assembly” to rewrite Bolivia’s constitution – a key MAS promise to its followers. But when the delegates to the CA were elected, MAS failed to win the 2/3rds needed to control it. So the CA has bogged down in procedural fights, with PODEMOS and other center-right parties blocking efforts to permit majority rule.

Finally,  in response to these MAS initiatives, the autonomistas have recently become much more aggressive and well-organized – some say, with outside support. Key politicians on the Right (especially “Colonel” Manfred) have seized the opportunity to make a national name for themselves.

In July 2006, Bolivia held a national referendum on whether to grant more power over revenues and spending to the country’s nine departments. The autonomistas lost by a wide margin.

Images_7 Despite this, in December 2006, six of the country’s nine governors -- including Manfred, the four Camba state governors, and Jose Luis Paredes, La Paz’ non-MAS Governor -- met in La Paz and demanded yet another (very costly) referendum on autonomy.

This triggered the massive confrontation noted above. Encouraged by Evo -- and perhaps also aided by support and organization from Venezuela -- more than 6000 of Evo’s supporters assembled in Cochabamba to demand Governor Manfred’s resignation. Many of his middle-class supporters stayed behind and engaged in sharp street battles with the cocaleros. Their included a band of more than a thousand stick-wavers militants who attacked the cocaleros with paramilitary-like discipline. At least three of those arrested were carrying guns and long knives. 


No one emerges from this conflict with clean hands. On the Left, key leaders like Oscar Olivares and Edgar Patano have supported the use of mass demonstrations almost as if the MAS could not rely on normal legal and electoral processes. Evo failed to discourage his supporters from occupying Cochabamba, despite the fact that Manfred had also been legally elected in 2005, and that while his call for a second referendum was provocative, it was not illegal.

Once the conflict started, Evo also took his time returning from Ortega’s inauguration. He didn’t arrive in Cochabamba until January 14, after the violence had subsided. Once there, he didn’t advise his followers to disband or retract their demands for Manfred’s resignation.

On the Right, the autonomistas and their political allies, especially Manfred, Paredes, and the four Camba governors, have also been provocative. Their demands for separatism and another regional referendum, as well as their refusal to compromise on CA voting procedures have been incendiary. Even more disturbing, the willingness of autonomistas to organize armed groups to attack MAS demonstrators indicates the potential for escalation.


024n2mun1_mini_1 There are now signs that both sides in this conflict are attempting to step back from the precipice, at least for the moment. With the Bolivian Army’s help, peace has returned to Cochabamba. Manfred has withdrawn his call for a second referendum.

As a way of defusing the demand for his resignation, MAS has introduced an emergency bill in Congress calling for a referendum revocatorio. This would require Bolivia’s elected officials -- mayors, governors, ministers, and even the President himself – to submit to referenda on their performance if they are accused of corruption, mishandling cash, human rights violations, or the failure to fulfill electoral promises. Evo’s Vice President, Alvaro Garcia Linares, has reaffirmed Manfred’s authority and offered to guarantee his safety.

Garcia_lineraStill, demands for the resignations of Manfred and Paredes have continued. Paredes has threatened that he and all the Camba state governors would all resign if Manfred were ousted. While peace has been restored, thousands of social movement activists are still very agitated.

Overall, the situation remains a power keg, with social peace owning a great deal to the continued presence and neutrality of the Army.  While a full-scale civil war has been averted for the time being, this could easily turn out to be a classic “lose-lose” situation -- especially if extremists on the Right and Left abandon their commitments to democratic procedures. The sharp escalation of this conflict in early January underscored the immaturity of Bolivia’s political leadership and the precarious state of its democracy.

On the other hand, as is often the case when decisive historical turning points are reached, this crisis might just possibly turn out to be constructive.

Bolivia’s leaders can seize the moment and achieve breakthroughs on key issues  like revenue-sharing, corruption, the Constituent Assembly, and the role of popular referendums, they may be able to achieve political innovations that will be of great interest to other Latin America democracies -- and the rest of us.

After all, despite centuries of oppression and brutal class conflict, Bolivia is  one of the few countries in the Americas that did not kill off its indigenous majority. Unlike other Latin American countries like Peru, Colombia, El Salvador, and Guatemala, Bolivia has  also  managed to avoid extreme social violence and civil war. We are hopeful that Bolivia's exceptionalism in this regard will be maintained.  But  it  could be sorely tested in the weeks and months to come.

(c) SubmergingMarkets, BuenaOnda Films, 2007

January 19, 2007 at 07:29 PM | Permalink | Comments (1) | TrackBack

Sunday, December 18, 2005

Bolivia's Democratic Revolution
James S. Henry
LaPaz, Bolivia

The mood at Tuto Quiroga's well-appointed campaign headquarters at the Hotel Radisson in downtown LaPaz was funereal, while across town at MAS Party headquarters in the former Brazilian Embassy, and later on in the impoverished township of El Alto,  people were chanting and singing in the streets late into the night. Not long after the polls in Bolivia closed late this Sunday afternoon1022moralesn,  it was already clear that the country's impoverished majority had finally elected one of their own as the country´s next President -- and by a much larger margin than any foreign policy expert, journalist, or Latin America political pundit had expected.

This is easily one of the most surprising and important elections in the history of Latin American democracy. For fans of the "neoliberal," free-market approach to development, as well as coca eradication, it is also a time for soul-searching.

Evo Morales, the 46-year old working-class meztizo, cocalero organizer, and leader of the neo-left "Movement Toward Socialism" party, has soundly defeated the seven other Presidential candidates in the race, capturing close to 50 percent of the nationwide vote.

While the final vote tally still has to be certifed by Bolivia's Electoral Court,  this clearly puts Evo within reach of becoming the first Bolivian President ever to have won a first-round victory outright -- without having the choice default to Bolivia`s fractious, "rent-seeking" Congress.


From an historical perspective, Evo's performance is an all-time record for a Bolivian Presidential candidate, far surpassing the 31 percent received by the second-place candidate, the free-market oriented-former President, Tuto Quiroga. It also surpasses the previous all-time high registered by Hernan Solis in 1982, as well as the 34 percent captured by neoliberal businessman "Goni" Sanchez de Lozada in 1993.

For that matter, relative to other recent elections in the Western Hemisphere, Evo has also outperformed the victory margins achieved by the US´President Bush, Brazil´s Lula, and Argentina's Kirchner. Whatever one thinks of Evo's economic platform -- and it certainly contains more than a little wishful thinking-- there is no doubt that, at least for the moment, he has far more credibility with the Bolivian people than his opponents.


Even more important than the historical records,  Bolivians have clearly voted en masse in favor of at least three fundamental changes in Bolivia`s social and political landscape -- all of them supported by MAS.


  • Reasserting public control over Bolivia`s natural resources, especially its huge natural gas reserves -- already, in official terms, the second largest in Latin America, and quite possibly much more.

    Evo's vague, rhetorical shorthand for this is "nationalization," but there is a whole range of policy options that MAS is considering to increase the public`s share of the income generated by its natural resources, and add more value, and generate more jobs by using these resources at home. Whether or not any of these will make practical economic sense is far from clear. But it is hard to argue that this program will  necessarily be any more disappointing for ordinary people than the last two decades of neoliberal policies.


  • Rejecting (US-backed) coca eradication programs. This supply-side approach to cocaine trade has been pursued by Bolivia since at least the mid-1980s, especially under the Banzer-Quiroga administration from 1997 to 2002.

    Unfortunately, as most observers outside the "drug enforcement complex" now agree -- including good solid conservatives like Milton Friedman and Steve Forbes --  the impact on ultimate cocaine supplies have been limited at best.

    At the same time,  the social, political, and economic impacts on countries like Bolivia, Columbia, and Peru have been disastrous.

    Oddly enough, with respect to drug enforcement, Evo is the true "neoliberal."  He believes that a poor country like Bolivia has a right to grow crops like coca if it makes economic sense, that punishing them for doing so is like punishing Dupont because some of its chemicals end up in illicit drugs, and that Bolivian farms should not be made to pay for the fact that  Americans and Brazilians can't control their bad habits.

    From this angle, his election is just one in a growing series of "corrective interviews" that Andean countries are giving to Washington on the huge costs of the failed supply-side drug control strategy. To summarize the matter quickly -- wouldn't the American people really have preferred to be buying several million cubit feet per day of LNG from Bolivia this winter, rather than pursue coca eradication policies in Bolivia that have had little impact on drug supplies while fostering a hostile political movement?

  • Much greater effective representation for Bolivia´s impoverished, excluded, indigenous and meztizo majority. In this case the cliche happens to be true -- for centuries, the Bolivian people have stood by and watched the country´s incredible raw materials -- silver, tin, iron ore, guano, rubber, and now natural gas -- being expropriated by private interests or elite-controlled state companies, while the vast majority have remained dirt poor.

    Futhermore, since the 1990s, Bolivia has been a virtual laboratory for neoliberal economics, as well as coca eradication. The country ended up with its most valuable assets in private hands, while more than half the population remained poor and inequality increased dramatically. Evo´s election sends a message, loud and clear, that Bolivians have had enough. Indeed, from this standpoint, their voting behavior is not particularly radical -- in capitalist terms, they are  simply a group of shareholders who have finally decided to show incompetent managers the door.

This  is a message that will reverbrate throughout the region -- in next year's elections in Peru, Colombia, and even Mexico, for example. This is a message that the US, in particular -- so obsessed with implanting "democracy" in the Middle East, and recently so careless about paying attention to Latin America's troubled democracies closer to home -- ignores at its peril.    


There is an old Russian proverb that says, "Keep an eye on your friends -- your enemies will take care of themselves."

Of course it is to be expected that hard-line America haters like Venezuela's Hugo Chavez and Cuba's Fidel Castro, as well as leading Latin leftlists like Lula and Kirchner,  will take pleasure in Evo's victory, just as many simple-minded American neoconservatives will regard it as an unmitigated setback. 

But Evo's erstwhile left-wing allies should be careful not to celebrate too soon.

In Fidel's case, the key question is, how soon is he prepared to give Cubans the same democratic rights that Bolivians have just exercized?   

In Hugo's case, the question is, is he prepared to make up all for the economic aid, debt relief, and lost exports that Bolivia will lose if it alienates the US and the international community by adopting policies like coca legalization and gas nationalization?  Isn't it just possible that he may well prefer for Bolivia's gas to stay in the ground, where it can't compete with Venezuela's proposed pipeline to Brazil and its proposed LNG exports to the US? 

In the case of Lula's Brazil and Kirchner's Argentina, the question is, are they really willing to renegotiate the lucrative gas export contracts they now have with Bolivia, helping Evo by sharply increasing the prices that they pay, while increasing their Bolivian investments?  Assuming that Bolivia is going to export at least part of its gas, shouldn't it consider competitors to Brazil and Argentina, rather than continue to be a captive supplier to these monopsonists?

Overall, therefore, it is easy for Latin America's kneejerk Left to celebrate Evo's rise as yet another defeat for Yankee imperialism -- and, indeed, there is just enough truth in that story to keep the brew bubbling. 

But every day that  Evo wakes up, he needs to remind himself that it was not the Yankees who are responsible for the fact that his country is one-half the size that it was 150 years ago;  that it is not Yankees who consumed most of his country's silver and other resources; that it is not Yankees that are consuming up to 30 million cubic feet per day of Bolivian gas at prices less than a fifth of US market levels (but Brazil and Argentina -- and Chile, by way of Argentina);  that it not Yankees who are content to keep Bolivia landlocked. On the other hand, it IS Yankees who have provided Bolivia with more foreign aid per capita than almost any other Third World country since 1948 -- much of which was admittedly wasted, but much of which undoubtedly did some good. 

In short, now that Evo is President, and not just an angry outside critic of the system, he will have to take responsibility for governing, and admit that Venezuelan, Brazilian, Argentine, and Chilean imperialism -- or, indeed, Chinese imperialism --  are no better than gringo imperialism.

As I`ll argue in Part II, none of these changes will be easy for Evo to implement within the bounds of Bolivia's existing political system, with its increasing regional polarities.   

Indeed, he faces an extraordinary list of challenges -- the least of which will be to become an effective head of government.  He will need a great deal of help. The US could usefully start by lifting its ban on holding discussions with him, and by granting him a visa. 

Despite all the obstacles, it is not too early to pronounce the strong, unified outpouring in favor of this program a ¨democratic revolution.¨

And what is perhaps most striking about this particular one is that Bolivia's people have made it on their own -- without the costly outside intervention that has been required to construct Lego-democracy in other well-known energy-rich developing countries.

(c)SubmergingMarkets, 2005

December 18, 2005 at 05:58 PM | Permalink | Comments (0) | TrackBack