In the Neo-Liberal Ruins: Why Venezuela Matters

Jeffrey Sachs had the wit to foresee the doom in his own economic remedies for Bolivia in the mid-1980s. The crisis then was hyper-inflation. “If you’re bold,” he remembers telling Bolivians in power, “you could turn a poor, land-locked, hyper-inflated country into a poor, land-locked country with stable prices.” The problem that free markets, free trade and foreign direct investment didn’t solve over the next twenty years was majority poverty in a pigmentocracy, as Sachs put it on Open Source two years ago. Bolivia was “a society of division, a society of conquest,” in which the 10-percent elite of white skin and European blood had never been impelled to invest in the impoverished Indian masses.

Click to listen to Chris’s conversation with Julia Buxton here (20 minutes, 9 mb mp3)

Julia Buxton, Bradford University

With a bit of a vengeance, Julia Buxton here picks up the history of the unraveling of the so-called “Washington consensus” of free-market cures for Latin economies. Inequality in fact widened in most of Latin America under the investment rules of the 1990s. The rules had to change “because the model wasn’t working,” she says. But it was homegrown politics — “this constituency of resistance,” as Julia Buxton calls it — that drove the undoing of policy: in Venezuela (which elected Hugo Chavez president in 1998), Bolivia (where the neo-socialist and “cocalero” Evo Morales won election in 2005) and Ecuador (where Rafael Correa took power in 2006). Venezuela remains for Professor Buxton the world model of the post-Washington development reality: the regeneration of community politics and economic development go ever hand-in-hand; and the Washington connection is discounted, if not unplugged.

Julia Buxton teaches at Bradford University in the U.K. She writes on openDemocracy. And she cleared the air at Brown’s “Changes in the Andes” conference with a PowerPoint stemwinder that triggered this conversation.