Solutions to the EU Crisis: Learning from Latin America
In this extract from an interview conducted by the Trans National Institute, former Bolivian ambassador Pablo Solon speaks about what the EU can learn from Latin America in confronting a debt crisis, and warns of the dangers of marketising nature under the guise of a 'green economy.'
How do you analyse the EU crisis from a Latin American perspective?
Pablo: Every crisis is a political moment. We can see a lot of similarities between Europe and what happened in Latin America 20 years ago. Institutions like the IMF told us that you must close the deficit, which in our case meant workers were thrown onto the streets (50,000 miners), state companies were privatised, and state expenses reduced. We are seeing a very similar recipe applied here.
At the beginning, a significant part of Bolivia's population believed this recipe might be the solution. They didn't react straight away. It took about 15 years to build a movement to reverse these policies. It was not easy, we were isolated at the time, dismissed as living on another planet. Now Bolivia doesn't follow the instructions of the World Bank and IMF and in general we no longer apply the same neoliberal measures.
The key question when you have an economic crisis is to ask: where is the money? Governments and institutions invariably look at people, but of course it is big corporations that are controlling the wealth. In Bolivia, when state companies were privatised, 80% of revenues went outside to transnational corporations so we had to revert this, and now 80% goes to the State. So as a result we have more investment in health, education and jobs.
As well as identifying where the money is and redistributing it, we also need to challenge the model of growth. The solution given even by progressive economists for the EU crisis is growth, but we know to grow for ever is to destroy the planet. We are already consuming more than the planet can in one year regenerate so that pattern is not going to work and humans will end up paying the bill. So we have to think of a solution that embraces all aspects of the crisis. I can understand the first priority is to create employment, that is real, but how do we build an alternative than goes beyond just increasing growth.
The consequences for ordinary people of IMF policies are horrific. How did you get out from under the IMF and World Bank – and in our case from the European Central Bank and European Commission too?
Pablo: Initially, we did have protests and strikes against neoliberal policies but everything was still privatised. The turning point came when we saw that water would be their next target. We mobilised for this battle and succeeded in 2000 in throwing out the Californian firm Bechtel and changed the law.
This victory was crucial in enabling social movements to see their real strengths. After the so-called 'water war' in Cochabamba, then there was a 'war' in support of nationalising gas, and finally people starting asking why not nationalise government!
In terms of how we won, the first thing we learnt was the importance of preparation: to succeed, you need to understand the problem better than them. This meant reading the contracts, the budgets, knowing the issue and outlining alternatives in simple terms. In the EU, our movements are still not there in terms of decodifying the financial crisis, which is why I think we are still on the back foot.
Then we started to build alliances, thinking of how to bring other players into the game, not just traditional actors but the rest of civil society that doesn't usually mobilise. In the case of water, we got the Catholic Church to approve a charter on water, when we got that, we used it to publicise our campaign via their infrastructure.
Then we had to look imaginatively at the measures we would take. In the case of mobilisations in our capital La Paz and its neighbouring city El Alto, we realised if we developed peaceful blockades in El Alto around the city of La Paz, that the capital wouldn't survive for 10 days. You can't necessarily replicate this, but there is always some kind of creative measure that your struggle can use.
Finally international solidarity is key. When we were sued by Bechtel, they got so much bad press by activists worldwide, that in the end they settled the case for one dollar. This wouldn't have happened if we hadn't thought in a global way.
Read the rest of the interview, in which Pablo Solon talks – amongst other things -about the achievements and frustrations of being in government, about the environmental crisis and Rio+20.