Americas Quarterly

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Mark Weisbrot

(continued from page 20)

poor people who did not previously schools”) increased from 271,593 nationalize some of the companies have it. In 1998, there were 1,628 pri- for the 1999/2000 school year to that were privatized in the 1990s. mary care physicians for a popula- 1,098,489 for the 2005/2006 school These nationalizations were a tion of 23. 4 million. Today, there are year. ⁸ Over one million people partic- response to the neoliberal reforms 19,571 for a population of 27 million. ipated in adult literacy programs. ⁹ that plunged Latin America into its In 1998, there were 417 emergency It remains to be seen whether the worst long-term growth performance rooms, 74 rehab centers and 1,628 nationalization of CANTV and parts in more than a century. Per capita primary care centers compared to of the electricity sector will also pro- GDP in the region grew by just nine 721 emergency rooms, 445 rehab duce positive results. CANTV, with percent between 1980 and 2000, and centers and 8,621 primary care a near-monopoly on land phones by five percent between 2000 and centers today. Since 2004, 399,662 and Internet service, has been slow 2005. But in the preceding 20 years, people have had eye operations that to expand access. Venezuela’s Inter- between 1960 and 1980, a period restored their vision. ³ In 1999, there net access remains below average when most of the region’s govern-were 335 HIV patients receiving anti- for the region, with 125 users per ments pursued state-directed devel-retroviral treatment from the state 1,000 people, as compared to 156 for opment policies, per capita GDP grew compared to 18,538 in 2006.⁴Latin America. ¹⁰ If the private sector by 82 percent. ¹³

Widespread access to affordable is unwilling to make the necessary There is always a danger that food is another benefit of Venezuela’s investment in such vital infrastruc- these new democratic governments state policies. By 2006, there were ture, then nationalization may make might mismanage the re-national- 15,726 stores throughout the country economic sense. izations. But so far the governments that offered mainly food items at sub- Meanwhile, in Bolivia, the re- seem to be aware of the limitations sidized prices (with average savings nationalization of its hydrocarbons with regard to administrative capac-of 27 percent and 39 percent). ⁵ These, industry has earned the government ity. They have not taken on major plus expanded special programs for an extra $670 million in revenue, or new responsibilities, such as run-the extremely poor (e.g., soup kitch- 6. 7 percent of GDP, ¹¹ equivalent to ning large sectors of the economy ens and food distribution), benefited $900 billion in revenue for the United or engaging in large-scale planning, an average of 67 percent and 43 per- States government. that they cannot handle. cent of the population in 2005 and State involvement in the economies Although voters have given them 2006, respectively. ⁶ The figures do of Latin America’s new democracies a broad mandate to pursue alterna-not include the 1. 8 million children actually has been much less than in tives to neo-liberalism, Latin Amer-that were on a school food program most of Western Europe. Bolivia’s ica’s new democratic governments in 2006, compared to 252,000 chil- general government total spending is have mostly acted with caution and dren in 1999.⁷31. 2 percent of GDP and Venezuela’s pragmatism.

Greater state involvement has is 30 percent. Compare that with 53. 4 also produced major improvements percent for France and 55. 5 percent in education. For example, the num- for Sweden. ¹² All that Venezuela and ber of primary schools (“Bolivarian Bolivia have done so far is to begin to

Mark Weisbrot is co-director of the Center for Economic and Policy Research in Washington, DC

rebuttal:

In referring to the “radical Left,” my intention has been to distinguish these governments from the moderate, center-left administrations of Chile, Brazil and Argentina. Much of the economic success of the moderates comes precisely from recognizing the fundamental role that markets play in the development process. It is quite a stretch to label Argentina’s attempts to maintain a competitive exchange rate a heterodox policy. ¹ The year before Chávez took office, PDVSA taxes and dividends paid to the government actually exceeded the firm’s profits by $1.1 billion. ²The simple truth is that PDVSA can now pay more to the government because of the six-fold increase in Venezuelan oil prices.

The case for government intervention is not bolstered by selectively citing meaningless statistics. One cannot draw the line between state-led and pro-market development strategies in 1980; Washington Consensus policies were only adopted after the debt crisis of the eighties. Private sector GDP in Venezuela went up in the series cited by Weisbrot because per capita oil production in this period declined by 18. 6 percent (mainly due to government mismanagement of PDVSA). This constant-price series excludes the effect of oil price increases. ³ The number of primary schools in Venezuela has not multiplied by four—indeed, it has barely increased. ⁴ What has grown is the number of schools labeled “Bolivarian.” —F. R.