In this chapter, the economic and political context of Latin American relations with the rest of the world and with the actors and circumstances within their own states is presented. The aim is to explain the framework in which the trans-national economic interests and their groups and corporations are acting and what kind of impact these relationships actually have at the local Latin American level. In the first part of the chapter, therefore, a rather economic perspective with an emphasis on international relationships is explained. The role of the international needs and markets will be discussed here, as will the emergence and relevance of economic policies at the international level and how the concepts of development, deregulation and neoliberalism are understood in this book. The second part will focus on the tension between the growing economic freedoms on the one hand and the increasing use of harsh and punitive criminal policies as a way of neutralizing or at least controlling individuals and populations excluded from the economic promise of development and wealth on the other. The domestic and international levels, in this sense, present quite similar dynamics.
The political and economic features of the current Latin American context
Talking about Latin America today and the impact of international economic policies in this region implies, among many other difficulties, accepting the challenge that it is necessary to consider the whole range of connections, interests and nationally and economically powerful actors that are on stage. The map exceeds by far the historical interrelations between Latin America and Europe, and the more recent, but not unproblematic, communications of Latin America with the United States of America. These two main actors remain central. The international scenario, however, when talking about international economic policies, today includes at least China, Russia and India as growing global players. Thus, the way in which policies are now carried out requires new perspectives and vocabulary as well. All this, of course, should be considered when the talk is about Latin America.
For example, whereas one author explains the “Easternisation” of global policies (Rachman 2016) as a kind of shift that we should take into account, another explains that global economic and political games are played more and more under the logic of “connections” and not any more under the logic of “territories” (Khanna 2016). Let me go a bit deeper into these ideas and their significance for Latin America.
In his book, Rachman made a compact presentation of colonization and economic power over centuries, and in this way, he explains the initiation of international economic relationships that continue today:
The global balance of power began to tip with the great European voyages of exploration of the 1490s. In 1492, Christopher Columbus, a Genoese explorer employed by the Spanish crown, crossed the Atlantic. In 1498, Vasco da Gama, a Portuguese explorer, reached India. It was the Portuguese and Spanish who began the process of transforming the relationship between Europe and the rest of the world. Over the succeeding centuries, Europe’s edge in military, seafaring and industrial technology allowed other European nations to build global empires. Russia expanded eastwards across Asia, all the way to the Pacific Ocean. The Dutch built an empire that reached as far as Indonesia. France’s colonies extended from Indochina to West Africa and the Caribbean. Britain gained control of India in the eighteenth century and led the “scramble for Africa” in the nineteenth century. By the early twentieth century, the British Empire alone covered almost a quarter of the world’s land area. The global domination of the “white races” was almost total. […] [T]he emergence of the United States as the world’s pre-eminent power, in the aftermath of the Second World War, prolonged the hegemony of the West. […] These centuries of European and American dominance were based on economic might. […] It is economic might that allows nations to generate the military, diplomatic and technological resources that translate into international political power. But, over the past fifty years, the West’s dominance of the global economy has steadily eroded.
(Rachman 2016: 4 ss.)
Latin America, in different ways, remains interconnected with the colonial-ist perspective of Europe and the United States. In this sense, the shift toward eastern areas, even when it is growing, is still not yet of great significance–at least not in the sense that it could change the structural conditions and practices that are limited to the first international economic powers in the region. China needs more and more soy and minerals, for example, to feed people and provide raw materials for high-tech industries, and thus, Latin America is experiencing the contact and influence of more and more Chinese capital in its territories. However, the Chinese cultural presence and pressure remain secondary. In other words, even if the United States and Europe no longer play the central role they played in Latin America over the last five centuries and especially in the last decades of the twentieth century, they are still more present than other internationally powerful actors, and the traces of their presence reach far, in time and space, into both the past and the future.
At the international level, indeed, the same thing happened
because the relationship between economic and political power is not straightforward. When China became the world’s largest economy it did not also automatically become the world’s most powerful country. On the contrary, the US retained a military, diplomatic and institutional edge that continued to justify its title as the “hyperpower”.
(Rachman 2016: 9)
And, of course, I would add, that with respect to (but not only) Latin America, this extends to Europe too. And, for the whole world, both powers remain significant because of their more or less democratic and libertarian promises. From this perspective, thus, the
West’s institutional advantage has led to a continuing American and European dominance of international finance and law–which, in turn, translates into a form of political power. Access to Western financial markets, educational institutions and courts still matters to the whole world.
(Rachman 2016: 15; similarly Guha & Vivekananda 1987)
Hence, in this interrelationship between Latin America and Europe, and Latin America and the United States, the kinds of interests at stake have changed very little across centuries. Latin America, historically, has provided Europe with raw material and natural resources (Galeano 1984; Altvater 2011). It was gold, silver, corn and cacao in the past, and it is wheat, soy, palm oil and nickel in the present. The United States has found cheap labor and oil and, of course, sugarcane, bananas and cotton. In the past, this all took place through colonial systems, and after the region became more and more politically independent, the goods and financial transfers became more and more sophisticated (Guha 1987; Guha & Vivekananda 1987). In this context, it is interesting to think about the differences among the foreign actors interested in the region:1 “At least initially, slavery and colonialism were acts of enterprising individuals and companies; governments entered later, often with softening effect” (Galtung 1996: 49). Since then, there have been military interventions in many cases, new corporate interventions in many others or simply diplomatic and free market relationships, in the rest.2
This change, however, does not necessarily mean a better situation. As it was said, “While military warfare is a regular threat, tug-of-war is a perpetual reality–to be won by economic master planning rather than military doctrine” (Khanna 2016: xvii). Latin America seems to be locked in this perpetual reality:
The exploitation of nonrenewable natural resources in Latin America is carried out by large consortiums of Canadian and American origin, whose objective is to have a strategic reserve in 100 different natural resources and minerals in the next 10 years, that is, they act under geopolitical objectives.
(Catalá Leman 2011)
The Latin American territory is huge and rich. The infrastructure in the region, however, has always been and remains insufficient and poor. The best infrastructure has been created with foreign investments aimed at improving the supply channels from internal areas to foreign countries. Harbors, routes, highways, trains and modern business skyscrapers are all physical infrastructures which were constructed by the local population for the improvement of the trade conditions of local goods on their way to the foreign countries’ population.3 And this point, according to current perspectives on global policy, is crucial. China has elevated infrastructure “to the status of a global good”, and there is a reason for this, according to some authors: “Geopolitics in a connected world plays out less on the Risk board of territorial conquest and more in the matrix of physical and digital infrastructure” (Khanna 2016: xvii). This idea, however, does not seem to fit to the Latin American region or, better said: old territorial logics are entangled with new infrastructural physical and digital aims. Given that Latin America retains its role as a natural resources provider, the struggles for the domain and property in this huge and rich natural territory is not part of the past, but an everyday nightmare for large parts of the population. Territorial struggles, as will be seen in the next chapters, are part of an ancient power strategy, that of the sovereign, who remains very active in Latin America and the Global South in general. Today, sovereigns are multiple and their thrones are not in the South, but in the North–their loyal feudal lords take care of their territories.
Technological, digital and highly complicated investment rules are far away from the daily problems of the people living on the rich territory, the natural resources and fertile pieces of land. Here, Harari’s idea takes on a particular relevance:
Ever since the Cognitive Revolution, Sapiens have thus been living in a dual reality. On the one hand, the objective reality of rivers, trees and lions; and on the other hand, the imagined reality of gods, nations and corporations. As time went by, the imagined reality became ever more powerful, so that today the very survival of rivers, trees and lions depends on the grace of imagined entities such as the United States and Google.
(Harari 2014: 36)
The imagined reality of economic discourse, actors and dynamics is so strong that the objective reality of abundance and richness of huge areas of the world leads these very areas to be the poorest ones.
The representation of more or fewer interconnections between interests and powerful actors around the world is often done with maps, and this is interesting because maps simplify at the same time that they show only what they want to show: green spaces without people living in them, blue areas free of plant or animal life, even underground richness which looks, to the eyes of entrepreneurs, like gold at the surface of a no man’s land waiting for good, brave explorers. Maps help to offer the whole world as a commodity for some. It was well said that “what we put on a map has iconic power to shape how people think” and that “we can never know the world without a map, nor definitively represent it with one” (Khanna 2016: xxi).
Thinking and the way of thinking is, no doubt, one of the most powerful means for the practice of power. In the Latin American case, since the first contact with Europe, this has also been a fact:
This new power relationship is imposed as a consequence of the conformation of a new and first “pattern of world power” from the conquest of America, in which Europe would have a central position gathering under its hegemony to “all forms of control of subjectivity, of culture, and especially of knowledge”. In other words, “all the experiences, histories, resources and cultural products, ended up also articulated in a single global cultural order around the European or Western hegemony”.
(Quijano 2000: 209, quoted by Rosso & Toledo López 2010: 5)
A new form of reading maps and of reading cultural hegemonies, so to speak, consists of looking very carefully at the economic, cultural and legal ideas that guide international, regional and national decisions. For the purpose of this study, the traces of some of these ideas will conduce toward the exposition of concepts like resources, deregulation, neoliberalism and development and their significance in the Latin American context.
Resources, deregulation, neoliberalism and development
The natural resources of the region were for a long time taken by other states with total impunity, then by agreements between countries and later through the financerization of Latin American economies driven by dictatorial regimes inspired and formed in the economic offices of the international North–essentially American (Heredia 2013; Taiana 2013). Today, however, the mechanisms of negotiation, extraction and transport have become sophisticated in every way. From the design or redesign of international regulations at international and interstate levels (EU directives, creation of economic zones, strategic unions, etc.), toward bilateral agreements that regulate investment conditions and specific industrial areas, there are more and more instruments scattered in the global economy which are weaving the networks of an economic matrix from which it is difficult to escape. For example, in the 1980s and 1990s, moved by the intention of political recognition in the international arena, various Latin American states began to introduce the liberalization of domestic regulations and the dismantling of protection measures for local interests regarding foreign investment and commercial relations on certain industries (Sadir 2009: 73 ss.). The following are particularly relevant: metal mining (especially opencast); hydrocarbons (traditional extraction and fracking); agroindustry (monocultures, chemical packages and genetically modified seeds and cultures); hydroelectric, wind and nuclear power; and infrastructure projects (roads and canals). This was done theoretically under the same conditions of negotiation between the signa-tory states. In reality, however, it was carried out precisely within the framework of an asymmetrical relationship–in the context of what has been explained with respect to the Latin American context and its geopolitical situation. After the closing of those agreements and the initial enthusiasm regarding the global recognition that signing them implied, the content of those agreements began to weigh in the region. For example, the Latin American states have been systematically brought before the ICSID, in times of extreme economic difficulties. The claims in the arbitration lawsuits had to do with breaches related to the payment of external debt to private actors, with modifications in the conditions of realization of the foreign investments and in an alleged decrease in the protection of specific industrial areas. All this was cause and result–both–of different cycles of economic crises in the Latin American states which were pushed to the verge of bankruptcies and social unrest (Sadir 2009: 80 ss.; Zanatta 2012: 258 ss.; Silveira Gorski 2014).
Deregulation, therefore, is related to the reregulation of some areas through new rules....
