Bolivian state of the union

01.05.2004

Bolivia's president, Carlos Mesa, spoke to the nation last night in what was heralded as an important address. This was his first major policy address since he was installed in office after Goni's overthrow. In the end, he said pretty much what everyone expected — though not, perhaps, what everyone hoped to hear. The realities of Bolivian politics have to be faced. And when they're faced, you end up w/ essentially the same policies that Goni (and previous governments) adopted.

Mesa chose the date of the one-hundred-year anniversary of the treaty that formally ended the War of the Pacific. Obviously, he spent some time speaking about the issue of Bolivia's claim to maritime sovereignty, demanding that Chile cooperate on this issue.

He also announced that he would (it was previously in much doubt) remain in power until 6 August 2007. He also added that Goni's overthrow meant the end of representative democracy — and that the country was now headed towards participative democracy. This part wasn't much elaborated upon, and I'm rather skeptical. There's strong strains of democratic theory that argue that "participative democracy" isn't practicable in large nation-states, and can lead to authoritarian tendencies (it's not for nothing that J.S. Mill warned against the "tyranny of the majority" against individual rights).

The issue of the gas referendum was fleshed out, w/ a date set for 28 March. Still, Mesa took the traditional (and rational) government line that the gas must be exported — it's, after all, a major source of possible income for the bankrupt country. Mesa pointed out that while some protesters in October opposed gas exports (the conflict hinged on its export through Chile, which riled nationalist sentiments), many agreed the resource must be exported. Of course, the result of the October uprising was that the California gas market was satisfied w/ another contract, effectively closing (for some time) any possibility of gas exports (unless a new buyer suddenly comes up).

In keeping w/ the gas theme, Mesa also pointed out three pillars for his administration's gas policy: 1) increase the revenues from oil & gas transnationals (which means revising existing contracts), 2) recover sovereignty over the hydrocarbons (currently, mineral resources belong to the nation when under ground, but to the company that extracts them once out of the ground), and 3) strengthen YPFB, the state gas & oil company. In addition, Mesa's government will continue Goni's project of installing home gas lines.

Of course, w/ all this talk about Mesa's policy plans for the gas & oil industry, one's left to wonder just what the referendum will decide.

Mesa also announced a new Social Emergency Fund of $50 million dollars to support the poorest regions of the country. He specifically mentioned El Alto, which he reminded was the center of the October uprising (he called it "the most conflictive" sector of the country). Money for this fund will come from the Andean Development Corporation (CAF) & the Inter-American Development Bank (IDB). At this point, Mesa also called on Bolivians to be "responsible citizens" who recognize their rights, but respect the rule of law.

Perhaps the most significant social demand — the Constituent Assembly — is now postponed to the first semester of 2005. The reasoning was that Bolivans will face two decisions in 2004: the gas referendum & nation-wide municipal elections. Also, there's no constitutional provision for a Constituent Assembly, meaning that parliament must first amend the Political Constitution of the State (CPE) to allow for such a body. Beyond that, parliament will no doubt debate the structure of the assembly (e.g. how will delegates be elected?). Hormando Vaca Diez, president of the Senate, announced Friday that the Constituent Assembly might not take place until 2006.

Mesa also made two unpopular announcements: First, there'd be no "truce" in the war on illegal coca crops. We're all holding our breaths to see what Evo Morales & the cocaleros will say to that. Second, like it or not, Bolivia needs to engage in free trade negotiations w/ the US as "a matter of necessity." Ditto (but add Solares & Quispe).

Finally, Mesa announced the obvious. The country's bankrupt; it spends 40% more than it collects in revenue (the rest of the national budget is kept afloat by US, European, Japanese, and other aid). Mesa announced the need for austerity measures — meaning cuts in the bureaucracy & projects.

-----
NOTE: My friend Daniel Bustillos posted a succint critique of Mesa's address (en español). Also, here's a preliminary roundup of reactions. The general consensus was that Mesa spoke for 80 minutes but made no concrete statements, only vague references & platitudes.

Posted by Miguel at 01:58 PM

Comments

As to: no constitutional provision for a Constituent Assembly, meaning that parliament must first amend the Political Constitution of the State (CPE) to allow for such a body. Beyond that, parliament will no doubt debate the structure of the assembly (e.g. how will delegates be elected?).

I am most interested to see how this turns out, government forming in media res, as it were.

A most fascinating nation.

Posted by: Chris Muir at January 5, 2004 05:42 PM

Yeah, I Want to know what the political actors think about what Mesa has spoken, we'll have to wait for a little while. Here is the link to Mesas's message to the nation: http://www.bolivia.com/noticias/AutoNoticias/DetalleNoticia17999.asp

Posted by: Daniel at January 5, 2004 05:42 PM

Yes. It's a startling development. I hope that in the end, the parliament will just make the wanted/necessary constitutional amendments (since a Constituent Assembly would just write a new constitution). But the postponment of this move won't make many happy -- Santa Cruz & Tarija (the oil/gas regions that threatened secession) demanded they want a Constituent Assembly before any gas referendum. Since they want to ensure regional autonomy that would make the referendum a region-only issue, keeping in mind that these regions supported Goni's government (they still support Goni!) and opposed the protesters.

Posted by: Miguel at January 5, 2004 05:48 PM

Two tidbits. First i bet that you ment to say something like $50 million dollars, or maybe $50 thousand dollars, but $50 doesn't go that far on it's own even in bolivia.

Secondly, i'm assuming you were trying to say that 40% of the national budget goes to paying international debt.

On a substantive point. Won't the wait of a couple years before the Constituent be enough for the traditional parties to take it and make it toothless.

What's this i hear from folks talking about an uprising in Feb or March?

Posted by: rabble at January 6, 2004 01:47 AM

Yes, the correct number is $50 million USD destined for El Alto, North Potosi and the outskirts of Santa Cruz.

As far as the budget breakdown, Mesa cited these numbers:

(approximately 8 Bs. = 1 USD)

15,000,000,000 Bs. Expenditures
9,600,000,000 Bs. Revenues
-5,400,000,000 Bs. Difference (deficit)

3,000,000,000 Bs. Expenditure used for External Debt

Bolivia spends approximately 20% of its expenditures on external debt.

I think the political parties will be looking to make the constituent as difficult as possible because it threatens their functionality and existence. If a second round is implemented into the presidential elections, then the entire corrupt coalition system will disintegrate. These coalitions breed the whole “pega” system which provides a disservice to citizens and never provided representation.

This speech was straight to the point and established a timetable for the upcoming referendum, local gas connections and constituent assembly. Mesa also provided the budgetary figures, which seems to reinforce this increased attention to access to public information.

I also agree that responsible citizenship is very important for participative democracy. However, Bolivians need to know that this difficult change of mindset will not be in vain.

Posted by: eduardo at January 6, 2004 05:12 AM

I made the correction in the post that the figure for the Emergency Social Fund was $50 million. Sorry about the oversight.

As for the question of a second round in presidential elections. I think this would be disastrous. For a good argument for why this is so, you can read Juan Linz, The Perils of Presidentialism.

And while there was a great deal of pegas in the Bolivian political system, I wonder if it was more/less than found in most European parliamentary systems (which are also based on coalition governments). I would strongly oppose a second-round electoral system, and would instead keep the basic framework as it stands, w/ some other corrections instead to other elements of the party system.

Posted by: Miguel at January 6, 2004 02:27 PM

My complaint towards the coalition system boils down to the degree to which the pegas undermine the entire public administration. Broadly speaking, whenever a new administration takes control, everyone from a department minister to the building doorman and everyone in between is replaced within the public administration. This causes serious loyalty and quality of public service issues.

I cannot speak for European governments because I have little knowledge how they operate, but I would imagine they are much more advanced in terms of merit-based and competitive hiring not based on political affiliation. Corruption is encouraged in this type of set-up in Bolivia where an enormous number of jobs are at stake.

I find that the political parties that want to participate in coalitions are not doing so for what’s best for their country, rather what’s best for their party. Once allied with the ruling party, these coalition parties get their share of the pie (prefectos, ministries) and can distribute the jobs as they see fit and reward their loyalists. Jobs in the public administration are not viewed as a way to serve their country, but rather, serve their fellow party members and pad their pockets during their short-lived tenure.

Posted by: eduardo at January 6, 2004 06:08 PM

Eduardo:

While I agree w/ you in general, there's a few minor points that must be fleshed out. If by the pegas system you mean the problem of complete turnover in the state bureaucracy every time coalitions change, then you're right to condemn the pegas. The national bureaucracy in Bolivia should be: A) trimmed down in personel, B) professionalized & insulated from partisan politics, and C) modernized.

I wouldn't, however, condemn coalitions-based politics as a whole. First, because it's quite successful in Europe. Second, because the lack of coalition politics in many other Latin American politics have created highly polarized, unstable presidential regimes. Up until recently, Bolivia was a remarkable case of presidential stability — in large part credited to its coalition-based politics.

Finally, I'd be cautions about a broad condemnation of parties. While I agree w/ most scholars that the majority of Bolivian parties are unprogramatic, personalist vehicles, some of the parties are "institutionalized" parties (or at least they were). Still, too many bad eggs spoil the whole basket.

Posted by: Miguel at January 6, 2004 09:07 PM