BlackNotBlack.com

The Mechanics of a Leftward Slide

Hugo Chávez by a landslide in Venezuela. Daniel Ortega returning from the political dead in Nicaragua. Michelle Bachelet becoming single mother to an entire nation in Chile. Néstor Kirchner in Argentina and Tabaré Vázquez in Uruguay. All over Latin America nations have embraced leftist leaders. There is analysis about it on virtually every news and poli-sci website you click to (not to mention on the shelves of those quaint relics called bookstores), but most of the material feels abstract, distant, like the events in question have been viewed from a Google Earth satellite.

Political journalist Jorge Casteneda says: “The combination of inequality and democracy tends to cause a movement to the left everywhere. This was true in western Europe from the end of the nineteenth century until after World War II; it is true today in Latin America.” Casteneda is an acclaimed scholar, and knows his stuff—you can Wiki him yourself—but again, phrases like “movement to the left” define the phenomenon from orbit. To understand from an up-close human perspective what is happening in Latin America, let’s hit zoom and touch down inside a specific event. Let’s land in Bolivia.

Several years ago, the Bolivian government privatized a water utility serving the central Bolivian city of Cochabamba. Privatization—the transfer of resources from public or government control or ownership to private enterprise—is a prerequisite for World Bank investment. The World Bank is a colossal lender in Latin America, but its billions are readily available only to countries which pursue a privatization agenda. Bolivia, under then-President Hugo Banzer, had been doing exactly that. Privatizing Cochabamba's water utility was part of this movement. It seemed like a good idea for all involved—the region was water starved, partly because its infrastructure was in disrepair. Whoever took over the water system would need to make improvements, but with only a slight rate hike they would, over the years, earn a handsome profit, while Banzer would take credit for serving the needs of his people.

Banzer's government struck a deal with a company called Aguas del Tunari. Aguas del Tunari was 27.5 percent owned by International Water Ltd., which was in turn owned by Bechtel Corporation of San Francisco. Determining who is truly in command in these situations is like trying to spot an army major in the field who refuses to wear his stripes for fear of snipers, but let's just say Bechtel was calling the shots. Aguas del Tunari promised worried Cochabamba residents that their water rates, if they rose at all, would do so by perhaps 35%. In exchange service would improve dramatically. A 35% percent hike seemed excessive to most people, but they adopted a wait-and-see attitude—since they had no actual say in the matter, it was their sole choice. To their chagrin, Aguas del Tunari's promises evaporated like a water mirage. Instead of a 35% percent hike, many people’s bills doubled and tripled. The reasons for this were simple—Aguas del Tunari was trying to meet contractually mandated profit levels. Faced with shortfalls, they raised rates. People in Cochabamba were outraged, but they adapted by depending more heavily on alternate water sources—wells, rainwater, river water. Aguas del Tunari continued suffering shortfalls, so the Bolivian government stepped in. Their solution was to draft legislation that would charge peasants for water which they drew from wells, and prohibit them from collecting from local lagoons, rivers, and the delta.

So the short version of the tale goes like this: the Bolivian government sold proprietorship of a public utility to a corporation; the corporation placed thirst for profit above their responsibility to provide a life sustaining resource at a reasonable price; and when people decided to collect the resource free from rivers and sky, the Bolivian government moved to criminalize this act in order to force people back to the corporation. The rest of this horror story is just as ugly as its preamble. Protests resulted, large ones, organized primarily by Oscar Olivera, a union official from the region. Violent clashes with police resulted, deaths occurred, and the city shut down. Aguas del Tunari offcials fled the country and President Banzer disappeared down a spider hole. Four days later he emerged and, in a cunning political backflip that would have impressed even a Cirque du Soleil acrobat, cited the departure of Aguas del Tunari officials from Bolivia as grounds to void the nation's contract with the company.


The Cochabamba debacle is not an isolated case. Right now there is a movement afoot by world business to remove all resources—such as water, education, social services, and national parks—from the public sphere and convert them into private commodities. As we hurtle further into the 21st century business looks for new avenues of investment, and public resources are an area that sends its Pavlovian drool reflex into flood stage. In the United States, for instance, Social Security—currently a public resource—is a target. Many of the people behind this movement contend that public resources should not exist at all. This might be sensible if corporations were legally required to serve the public interest, but they aren't—quite the opposite, in fact. Corporations are required by their charters and by the law to put their own interests above those of people, resources and ecosystems. In Aguas del Tunari's case, that meant whether the people of Cochabamba were able to drink was secondary to the bottom line.

Corporate advocates claim that the Bolivian Water War was an isolated incident, while corporate critics claim it was a real world test of the pitfalls of privatization, and that the same pitfalls will exist in each and every case. They believe Aguas del Tunari was complicit with the Bolivian government in attempting to bar people from collecting a resource which they needed for survival. It wasn’t necessarily that Aguas del Tunari/Bechtel thought they could get away with it—it was that it made financial sense to at least try. Heartless though it may seem, this kind of thinking is the modus operandi for all shareholder-owned corporations. The fact that U.S. politicians—primarily from the right wing—have passed laws allowing corporations to dominate American daily life is barely different than inviting Dracula into the house for a nightcap. Author Joel Bakan, in his book The Corporation, asked a psychologist to construct a personality profile on a typical corporation. It was not such a strange request—since a corporation has the same legal rights as a person, Bakan was interested in knowing exactly what kind of citizen was walking the American streets. The corporation as a person rated as a textbook example of a murderous psychopath.

Soon after the Bolivian Water War Hugo Banzer resigned as Bolivia’s president, bringing about the appointment of an interim ruler, and finally the election of left-leaning Evo Morales. Morales is the first president in Latin America of native descent, and a long awaited alternative to creatures like Banzer, who was the latest in a line of privileged, distant men descended from European colonists. Morales speaks to Bolivians of resisting the greedy capitalists from the north, and redressing previous corporate wrongs. The wisdom of his words seems self-evident to the people of Bolivia in light of the Cochabamba episode, which has grown to Homeric proportions as an example of successful resistance against greedy yankees. In Morales, Bolivians believe they have someone who won’t put them through an ordeal like Cochabamba again, nor be bullied by the World Bank, nor, most importantly, spout populist rhetoric while accepting cash-filled suitcases behind the scenes.

Meanwhile, back in San Francisco, the Bechtel corporation is nicked but defiant. A Bechtel website—which sorts right to the top of Google over hundreds of related links—contains the company’s version of events in Cochabamba. It is, of course, comprised mainly of denials. But reputable third-parties such as PBS and The Democracy Center have confirmed many of the stories told by peasants. Sadly, Cochabamba is just one example of corporations rushing to carve out profit in Latin America under the banner of privatization. When I lived in Guatemala it seemed there was a new scandal every week. The corporate response to these episodes was always the same—doublespeak so dismissive that it seemed obvious they considered Latin Americans nothing more than little brown nuisances. In response to Bechtel’s denials The Democracy Center sent CEO Riley Bechtel an open letter, asking him to explain his version of events. Rather than respond himself, he left it to one of his public relations androids, who said that prices never went up more than a small fraction.

Personnel from The Democracy Project, dredging figures from the same computer Aguas del Tunari used for billing, detailed example after example of families whose income was perhaps sixty dollars a month being billed twenty dollars or more for water. In their PR smokescreen Bechtel claimed that because they improved the water service, more water was being used by the people. But if water usage increased, as Bechtel asserts, why was it neccesary to draft legislation barring Cochabambans from collecting riverwater? The Democracy Project pulled data from the Aguas del Tunari computers proving that when rates skyrocketed usage immediately went down. Most notable was the case of a family whose water bill tripled even though they cut back on usage by 18%. A view from the Google Earth satellite reveals a giant raft of horse manure floating toward Bolivia from San Francisco Bay.

But when a company like Bechtel makes barely believable excuses for their behavior, they aren’t actually trying to defend themselves—they are reinforcing their dogma, declaring their infallibility. Bechtel, through its subsidiary of a subsidiary Aguas del Tunari, blamed the Cochabamba protests on a rival water consortium. Then they blamed them on drug traffickers. They were anybody's fault, everybody's fault—except Bechtel's. But even though such weak excuses resonate for a while in the media, and a few true believers in the far right quadrant try to spin them into something solid, the arrogance behind their creation eventually becomes crystal clear. This arrogance is a symptom of a larger feeling of entitlement which is pervasive within the U.S. business community, but which often trips them up in the end. It certainly did in Cochabamba, where people now understand that smooth-talking businessmen from the North always promise exactly what is most needed, while eyeing nearby necks for a tender vein. It is a major reason Bolivia is yet another Latin American nation sliding leftward even as the claw of corporate excess reaches toward it from the right.

Labels: bechtel, bolivia, cochabamba, evo morales, privatization

posted by Egan Ehlers @ 1:13 PM