Showing posts with label latin america. Show all posts
Showing posts with label latin america. Show all posts

Friday, October 11, 2013

How Globalization Made São Paulo into a Diplomatic Power


Wednesday, July 22, 2009

A Latin American Perspective on the Economic Crisis


http://www.theglobalist.com/StoryId.aspx?StoryId=7857

The Governor of Sao Paolo, Brazil, José Serra, provides a refreshing take on the global economic crisis. In the first of a two-part series, he describes the unique position of Latin American economies that are poised for a speedy recovery.

Known in the 1980s as the “Continent of Crises,” Latin America is now in a unique position — reminiscent in some ways of its fate during the Great Depression.

In the same way as 80 years ago, and in contrast to more recent episodes, it finds itself again as the victim, not the perpetrator, of economic downfall.

Both Chile and Peru faced greater vulnerabilities in the international crisis than Brazil because their export-to-GDP ratios are three to four times higher than Brazil's.

Another similarity with the 1930s is that everything seems to indicate that, once more, it will recover faster than the central economies.

In the 1930s, practically all Latin American countries except Chile and Cuba had surpassed their pre-depression peak of real GDP many years before the United States. Colombia did so in 1932, Brazil in 1933, Mexico in 1934 and Argentina in 1935.

The basic explanation for this relatively less severe crisis impact in Latin America and Asia can be found in an almost disregarded but essential fact: the channel of contagion. The central economies’ financial meltdown spread to so-called emerging economies not through its original causes, but through its effects.

The same causes as in the United States — real estate bubbles, packages of securitized subprime mortgages, excessive financial deregulation and dangerous levels of leverage — produced the same catastrophic results wherever they were present, in the United Kingdom, Ireland, Spain or Iceland.

In Brazil, in Latin America as a whole and in Asia, contagion came rather through the byproducts of the crisis — mainly the abrupt contractions of finance and trade. There were no major bank collapses, no bank runs, no real estate bubbles and no subprime worries.

The only grave exceptions were the derivative losses in Mexico of $4 billion in the last quarter of 2008 and Brazil’s, which were estimated at $25 billion.

As a result, the Latin American financial and banking system remained basically intact, notwithstanding a steep reduction in credit supply to productive activities as a consequence of the loss of foreign credit lines.

Despite further cuts later on, Brazilian interest rates remain the highest worldwide, leading to unnecessary and excessive reevaluation of the exchange rate.

Nevertheless, some of the painful aspects of the economic slowdown could have been avoided were it not for some misjudgments about the crisis’ nature. Such mistakes were compounded by the lack of capacity to conduct a vigorous and prompt countercyclical policy in economies that did not prepare adequately for the predictable downturn in external conditions.

Indeed, one of the lessons to be learned from the management of the crisis in Latin America is the need to shed new light on an old truth: The clarity, intensity and speed of policy responses are as indispensable as the correctness of such policies’ general direction.

The “best case” example of policies with all these desirable qualities has been Chile, where at one point the Central Bank resolutely cut the interest rate in a single stroke by an astounding 250 basis points. More recently, in the third week of June 2009, it has again cut 50 points, easing the basic interest rate to 0.75%, a level where it is expected to remain for the rest of the year.

At the same time — thanks to the clear-sightedness and prudence of building up a countercyclical fund — Chile and Peru were able to support the declining economy with a robust stimulus fiscal package in the amount of 2% of GDP or more, thus helping to soften the weakening in industrial production and in investment.

It should be noted that both Chile and Peru faced greater vulnerabilities in the international crisis than Brazil because their export-to-GDP ratios are three to four times higher than Brazil's, increasing the negative effect of world trade’s slowdown on the domestic economy.

The time when national authorities should have sent a resolute and unequivocal signal to the markets was at the height of the panic created by the mid-September 2008 Lehman Brothers collapse. In that crucial moment there was no longer any justification for mis-targeting inflation, not recession, as the clear and present danger to the economy.

National authorities should have sent a resolute and unequivocal signal to the markets at the height of the panic created by the mid-September 2008 Lehman Brothers collapse.

Wherever authorities failed to respond in an appropriate way, the consequence has been to delay or slow economic recovery, creating unnecessary pain and suffering in terms of lost output and growing unemployment.

The record in crisis management has been somewhat mixed in some nations. In my own country, Brazil, the first signs of a consumer-driven recovery have begun to appear.

It is largely the product of a considerable expansion in current governmental expenditure with personnel and a variety of social assistance programs, as well as tax cuts on cars and domestic appliances sales. It will probably help stimulate the consumption sector for the time being.

However, the sustainability of the current rate of expenditure growth without additional tax increases will depend on a vigorous resumption of productive investment and industrial expansion.

Certainly, positive things could be mentioned about the post-Lehman Brothers economic policy measures in Brazil: reduction of compulsory deposit requirements held at Central Bank (taken at the very beginning), guarantees to term bank deposits (valid, albeit a bit late) and increasing lending by BNDES (National Development Bank), which has been operating swiftly to substantively restructure companies affected by the crisis.

However, there is no denying the evidence: At the critical moment in September-October 2008, monetary policy failed to provide entrepreneurs and markets with a stimulus sufficiently strong and timely to avoid a steep fall in industrial output and investment. The Brazilian real interest rate, the world’s highest, only started to be reduced, and very slightly, three months after September 15th.

The clarity, intensity and speed of policy responses are as indispensable as the correctness of such policies’ general direction.

Despite further cuts later on, Brazilian interest rates remain the highest worldwide, leading to unnecessary and excessive reevaluation of the exchange rate. This process is ongoing since January 2009, and threatens Brazil’s position as one of the countries that will come out of this crisis most successfully.

In addition, public investment in badly needed infrastructure did not reach the critical mass necessary in order to offset the deep plunge in private investment.

Under a few defining and important common characteristics, Latin America presents a huge diversity in conditions and intensity of the crisis’ impact. These should warn us against any attempt at simplifying reality.

Some smaller economies, mostly in Central America and the Caribbean, are acutely dependent on tourism or migrants’ remittances and have been particularly hit by the slowdown. Others, such as dollarized economies and countries that concentrate a high percentage of trade inside the North American economic space, closely mirror the United States’ vicissitudes and will probably have to wait for a change in U.S. fortunes.

In Chile, at one point the Central Bank resolutely cut the interest rate in a single stroke by an astounding 250 basis points.

Finally, those who mainly export products derived from natural resources have been somewhat fortunate in finding in China a resilient source of demand for their commodities.

The reason why I am addressing developments in Brazil and South America instead of repeating what is already known, as far as the U.S. and world financial troubles are concerned, is because I want to stress a central fact regarding crisis management.

Regardless of apportioning blame for the original roots of the crisis — and in this case it should squarely lay on the shoulders of American bankers, regulators and policymakers — the ultimate responsibility for passively accepting crisis fallouts in other nations or effectively neutralizing them depends on the quality and adequacy of national policy responses.

In other words, the quality of national policies does matter.

Editor's Note: Read Part II here.

This article is adapted from Governor Serra's speech to the Foresight International Conference, given June 18, 2009 in Washington D.C. The conference is part of a series of events put on through a partnership between Deutsche Bank’s International Forum and the Alfred Herrhausen Society. For more information click here.

Friday, September 12, 2008

Development, Democracy, and Welfare States

Stephan Haggard, Univ. of California, San Diego
Robert R. Kaufman, Rutgers University
Princeton Univ. Press 2008

.

Introduction [HTML] or [PDF format]

This is the first book to compare the distinctive welfare states of Latin America, East Asia, and Eastern Europe. Stephan Haggard and Robert Kaufman trace the historical origins of social policy in these regions to crucial political changes in the mid-twentieth century, and show how the legacies of these early choices are influencing welfare reform following democratization and globalization.

After World War II, communist regimes in Eastern Europe adopted wide-ranging socialist entitlements while conservative dictatorships in East Asia sharply limited social security but invested in education. In Latin America, where welfare systems were instituted earlier, unequal social-security systems favored formal sector workers and the middle class.

Haggard and Kaufman compare the different welfare paths of the countries in these regions following democratization and the move toward more open economies. Although these transformations generated pressure to reform existing welfare systems, economic performance and welfare legacies exerted a more profound influence. The authors show how exclusionary welfare systems and economic crisis in Latin America created incentives to adopt liberal social-policy reforms, while social entitlements from the communist era limited the scope of liberal reforms in the new democracies of Eastern Europe. In East Asia, high growth and permissive fiscal conditions provided opportunities to broaden social entitlements in the new democracies.

This book highlights the importance of placing the contemporary effects of democratization and globalization into a broader historical context.

Stephan Haggard is the Lawrence and Sallye Krause Professor of Korea-Pacific Studies at the University of California, San Diego. Robert R. Kaufman is professor of political science at Rutgers University.

Endorsements:

"While many authors cannot see beyond the borders of their own country, Haggard and Kaufman masterfully compare Latin America, East Asia, and East Europe from a global perspective. These two great scholars analyze urgent contemporary problems, the status and future fate of the welfare state, and the relationship of changes with the creation and development of democracy with remarkable expertise, precision, and human empathy."--János Kornai, professor emeritus, Harvard University and Collegium Budapest

"This ambitious book extends the theoretical framework of the literature on welfare states in the advanced capitalist countries, and situates the experience of these countries in a broader comparative context. Haggard and Kaufman bring out the multifaceted implications of development models and regime types for social policy. Their synthetic account is truly a tour de force and a testimony to the fruitfulness of cross-regional comparison."--Jonas Pontusson, Princeton University

"A masterly analysis of how political interests, economic circumstances, development strategies, and local history have shaped what are surprisingly different versions of the welfare state across the developing world. The authors combine fine-grained country analyses with intelligent use of data, and explain and extend the theory and literature on the modern welfare state. The book is both scholarly and readable."--Nancy Birdsall, president of the Center for Global Development

"This book has no equal in the welfare-state literature, a truly impressive achievement. Haggard and Kaufman combine meticulous scholarship with sophisticated theoretical guidance in this study of welfare state evolution in Latin America, Asia, and East Europe. The book not only fills a huge void in our knowledge, it also compels us to seriously rethink prevailing theory."--Gøsta Esping-Andersen, Universitat Pompeu Fabra, Barcelona

More endorsements

Table of Contents

List of Figures xi
List of Tables xiii
Preface and Acknowledgments xvii
Abbreviations xxiii

INTRODUCTION: Toward a Political Economy of Social Policy 1
PART ONE: The Historical Origins of Welfare Systems, 1945-80 25
CHAPTER ONE: Social Policy in Latin America, East Asia, and Eastern Europe, 1945-80: An Overview 27
CHAPTER TWO: The Expansion of Welfare Commitments in Latin America, 1945-80 79
CHAPTER THREE: The Evolution of Social Contracts in East Asia, 1950-80 114
CHAPTER FOUR: Building the Socialist Welfare State: The Expansion of Welfare Commitments in Eastern Europe 143

PART TWO: Democratization, Economic Crisis, and Welfare Reform, 1980-2005 179
CHAPTER FIVE: The Political Economy of Welfare Reform 181
CHAPTER SIX: Democracy, Growth, and the Evolution of Social Contracts in East Asia, 1980-2005 221
CHAPTER SEVEN: Democracy, Economic Crisis, and Social Policy in Latin America, 1980-2005 262
CHAPTER EIGHT: The Legacy of the Socialist Welfare State, 1990-2005 305
CONCLUSION: Latin America, East Asia, Eastern Europe, and the Theory of the Welfare State 346

APPENDIX ONE: Cross-National Empirical Studies of the Effects of Democracy on Social Policy and Social Outcomes 365
APPENDIX TWO: Fiscal Federalism and Social Spending in Latin America, East Asia, and Eastern Europe 370
APPENDIX THREE: A Cross-Section Model of Social Policy and Outcomes in Middle-Income Countries, 1973-80 372
APPENDIX FOUR: Regime-Coding Rules 379
APPENDIX FIVE: A Cross-Section, Time-Series Model of Social Spending in Latin America, East Asia, and Eastern Europe, 1980-2000 382
APPENDIX SIX: Social Security, Health, and Education Expenditure in East Asia, Latin America, and Eastern Europe, 1980-2005 387

References 399
Index 449


http://press.princeton.edu/titles/8775.html

Friday, April 25, 2008

Latin American Politics and Society

Latin American Politics and Society
Spring 2008 - Vol. 50 Issue 1 Page iii-216

.

From Pariah State to Global Protagonist: Argentina and the Struggle for International Human Rights

Kathryn Sikkink

pages 1–29

Abstract

Full Text PDF (399 KB)

Liberal and Illiberal Democracy in Latin America

Peter H. Smith Melissa R. Ziegler

pages 31–57

Abstract

Full Text PDF (393 KB)

Paul G. Buchanan

pages 59–89

Abstract

Full Text PDF (224 KB)

José Pedro Zúquete

pages 91–121

Abstract

Full Text PDF (225 KB)

Omar Sanchez
pages 123–151

Abstract

Full Text PDF (216 KB)

Richard Feinberg

pages 153–168

Abstract

Full Text PDF (168 KB)

Michelle D. Bonner

pages 169–183

Summary

Full Text PDF (164 KB)

pages 185–216

Abstract

Full Text PDF (213 KB)


Wednesday, November 07, 2007

Capitalist Development and Democracy in Latin America

Evelyne Huber Stephens, Northwestern University
.
In the current debate on redemocratization in Latin America, the focus is squarely on political variables proper, that is, on the political process as shaped by political institutions and leadership. Political choices by major actors, particularly the adoption of explicit or implicit political pacts designed to ensure the transition, are accorded primary importance. In fact, the most influential work on the topic has argued that the high indeterminacy of the process of transition makes the use of conventional social science categories and approaches, such as class, sectors, institutions, and macroeconomic and world systemic structures inadequate for its analysis (O'Donnell and Schmitter 1986:4).

Whereas this focus is certainly appropriate for the immediate transition period, the other important question, namely consolidation of democratic regimes in the medium and longer run, draws attention to underlying structural conditions favorable to such an endeavor. Analyses of the process of transition in a given country "freeze" the structural context; there is generally little structural change over the relatively short periods of transition. Furthermore, analyses comparing processes of transition in the late seventies and the eighties keep the world economic and political context constant, and they tend to take structure in the individual countries as a given. Taking a longer historical view, though, and asking under what conditions democracies were established and consolidated in Latin America in the past and are likely to be consolidated in the future moves structural variables back into the center of attention.1 Yet, with the exception of Therborn's (1979) attempt, there is no theoretically well grounded, comparative historical structural treatment of the emergence and decline of (nearly) democratic forms of rule which covers all the South American countries.

The following analysis provides such a treatment and demonstrates that structural factors have considerable explanatory power for the trajectory of democracy in South America. The nature of a country's integration into the world market (enclaves versus nationally controlled export sectors), the labor requirements of agriculture, the degree of subsidiary industrialization generated by the export sector, the process of consolidation of state power, the role of the state in shaping civil society, the class alliances to which the economic and social structures gave rise, along with the nature of political parties strongly influenced the dynamics of democratization. The relationships between these variables and democratic rule are by no means simple and unilinear. Some factors have contradictory consequences for democratization, some effects change over time, and the various factors interact over time. Accordingly, the analysis here will be comparative historical, paying attention to the way in which economic growth and the patterns of dependence shaped the class structure and class relations and influenced political change, and taking the lasting effects of certain historical conjunctures seriously.

The theoretical building blocks for this comparative historical analysis are Moore's (1966) emphasis on the importance of the survival of labor repressive landlords into the modern era, Skocpol's (1979) emphasis on the role of the state and the interstate system, Cardoso and Faletto's (1979) and O'Donnell's (1973) emphasis on the effects of dependent development on class structure and class alliances, and the working class strength perspective's (Korpi 1978; J. Stephens 1979; Esping-Andersen, 1985; Stephens and Stephens, 1986) emphasis on the importance of the organizational power of subordinate classes.

In a nutshell, I will argue that the difficult processes of consolidation of state power cast the military in a prominent role in politics, set the precedent for alliances between factions of civilian elites and of the military in the struggle for state power, and made institutionalization of contestation difficult. After a period of significant export expansion, large landowners in nationally controlled export economies tended to develop into a hegemonic class and to establish contestation among themselves. Where agriculture was labor intensive, these landowners became crucial obstacles to political inclusion of the lower classes; where it was less so, they were willing to compromise. In enclave economies, the large landowners were less hegemonic as a class, and in some cases anti-oligarchic alliances were able to force the establishment of a democratic regime, but unable to consolidate it. Where the export sector generated subsidiary industrialization and high urbanization, pressures for democratization emerged comparatively early. Import substitution industrialization generated such pressures everywhere, but the pressures remained weaker where the state prevented the independent political articulation of civil society, most prominently in Brazil. In enclave economies, there was a stronger tendency for middle class - working class alliances to emerge, forged by political parties approximating the mass party type. Such alliances were more likely to push for full democracy, i.e. with universal suffrage, than alliances between the middle classes and sectors of the economic elites which pushed for an opening of the political system and had their base in clientelistic parties. For the consolidation of democracy, particularly for the reduction of military involvement in politics, the presence of two or more strong political parties, at least one of which effectively represented elite interests, proved to be indispensable.

The analysis here will be confined to South America; political dynamics in the Central American countries, which were shaped to a much greater extent by U.S. political intervention, are analyzed elsewhere (Stephens and Stephens 1987). Since genuine democracies are so rare in South America and regime forms so varied, we first have to cast a conceptual net over this diversity and construct theoretically meaningful dependent variables. After proposing a classification of regimes according to their degree of contestation and inclusion and filling it with historical cases, I will first analyze the factors leading to the establishment of the various types of regimes, then the factors which support the consolidation or breakdown of democratic regimes, and finally those which promote redemocratization. The distinction between these different stages in the analysis is important because factors which are supportive of the installation of some form of democratic regime may not be so for its consolidation, and because the existence of a democratic regime profoundly influences future political dynamics.2


Full-Text is available at:
http://kellogg.nd.edu/publications/workingpapers/WPS/122.pdf

Paper prepared for the Meetings of the Midwest Political Science Association, Chicago, April 1988. An earlier version of this paper was delivered at the Meetings of the Latin American Studies Association, New Orleans, March 1988.

I would like to thank the Kellogg Institute of the University of Notre Dame, where much of the work on this paper was done, as well as Manuel Antonio Garretón, Guillermo O'Donnell, Dietrich Rueschemeyer, John D. Stephens, and J. Samuel Valenzuela for comments on earlier drafts. (EHS)

Wednesday, August 24, 2005

Asia, Africa, Latin America II

Handing the 21st century to Asia, Dominique Moïsi
Conversation about Human Rights Crisis in Darfur, HREA
The End of Colonialism? The Irony of Bandung Conference, Claude Arpi
Imperialism of the Fittest , V. Inozemtsev & S. Karaganov
China's Search for Stability with America, Wang Jisi
Rising Dragon and the American Eagle - Part I, David Shambaugh
Rising Dragon and the American Eagle - Part II, Robert Sutter
The Dragon Awakes, Ian Bremmer
China: Is it a Threat, or an Opportunity?, People's Daily Online
Contagious Capitalism: Globalization and the Politics of Labor in China, Mary Elizabeth Gallagher
Made in the PRC: Consumers in China, Amy Hanser
Domestic Threats to China's Rise, Adam Wolfe
China's Internet: Let a Thousand Filters Bloom, Rebecca MacKinnon
ChinaScope Magazine
The Schizophrenic Superpower, Alan Dupont
India's Promise? Conflicting Prospects for the World's Most Populous Democracy, Devesh Kapur
India: America's New Ally?, Stephen P. Cohen
The India Imperative, Robert D. Blackwill
An Axis of Democracy?, Rajan Menon & Swati Pandey
Regional Integration in East Asia: Challenges and Opportunities- Part I: History and Institutions , E. Sakakibara & S. Yamakawa
Virginia Review of Asian Studies, VCAS
Comparative Connections (E-Journal on East Asian Bilateral Relations), CSIS
International Third World Studies Journal and Review, Univ. of Nebraska
Inter Press Service News Agency
Pakistan: Between Mosque and Military, Husain Haqqani
An Inquiry into the D-8 Experiment: An Incipient Model of an Islamic Common Market?, Berdal Aral
Economist Blames Aid for Africa Famine , Yahoo News
Millennium Development Goals: Moving Backwards, Gustavo Capdevila
Global Anti-Poverty Campaign Hangs in the Balance, Haider Rizvi
The Dollar and Development, Richard Sabot
(Mis)Understanding Chávez and Venezuela in Times of Revolution, L. Vivas & J. Pablo Lupi
Boletín Tecnología para la Organización Pública
Educational Portal of the Americas
.
Africa, Asia, Latin America (I)
.
Related Posts with Thumbnails

Düşünce Kahvesi

Photography

Photography
dpchallenge.com

Reset Dialogues on Civilazations

NPR: World Music

NYT: Travel and Cities

H-Net Academic Announcements