Political Order and Political Decay (43 page)

Similar developments never materialized in Latin America. Centeno notes that in Brazil and Mexico, two countries for which nineteenth-century data is available, governments extracted no more than a quarter to a half of the taxes per capita that Britain did in the same period. Moreover, they were much more heavily reliant on indirect taxes like customs and excise duties. These are much easier to collect than direct taxes on businesses and individuals, and are always the first kinds of taxes that developing countries with weak administrative capacity tend to use. Even when it was fighting wars, the Brazilian government did not collect more than 4 percent of total revenues from taxes on wealth and production. Chile—sometimes called the “Prussia of Latin America” for its military prowess against its neighbors—collected an even lower percentage. In this regard, they were simply following the pattern set by Latin America's colonial master, Spain, which was itself perpetually unable to raise sufficient tax revenues from its own people, and was forced to declare bankruptcy ten times between 1557 and 1662.
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The relative absence of interstate war may explain why Latin America has fewer strong states than Europe, but it does not explain why some countries in the region have more effective governments than others. Political scientist Marcus Kurtz points out that there has been a relatively constant rank ordering of effective states since the nineteenth century, with Chile and Uruguay consistently topping the tables, and Bolivia, Paraguay, and Haiti typically coming out close to the bottom.
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He argues that Chile, Uruguay, and Argentina were able to build strong states initially due to a combination of free agricultural labor and relatively strong elite consensus, but that Argentina's state subsequently deteriorated as a result of the class conflict after the 1930s. The historical contingency of these outcomes suggests the difficulty of providing a parsimonious theoretical model of state building.
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Nonetheless, the lower intensity of interstate war in Latin America did lead to some familiar outcomes. There was much less competitive pressure to consolidate strong national bureaucracies along French-Prussian lines prior to the arrival of mass political participation in the late nineteenth and early twentieth centuries. This meant that when the franchise was opened up in the early twentieth century, there was no “absolutist coalition” in place to protect the autonomy of national bureaucracies. The spread of democratic political competition created huge incentives in Argentina, Brazil, Mexico, Colombia, and other countries for democratic politicians to use clientelistic methods to recruit voters, and consequently to turn public administration into a piggy bank for political appointments. With the partial exceptions of Chile and Uruguay, countries in Latin America followed the paths of Greece and southern Italy and transformed nineteenth-century patronage politics into full-blown twentieth-century clientelism.

Having created patronage-ridden states, the countries of Latin America have faced what political scientist Barbara Geddes has called the “politician's dilemma.” As in nineteenth-century America, there was a clear public interest in reforming the state and putting it on a more meritocratic foundation. But doing so would cut into the politicians' fund of political capital, so few had incentives to proceed. Geddes argues that reform took place only under special conditions, such as when the political parties were balanced and none would get a special advantage by pushing for reform.
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External shocks, not in the form of military threat but of financial crisis, were sometimes also effective in forcing change. Thus, following the Latin American debt crisis of the early 1980s, there was a major effort to professionalize central banks and finance ministries, which has led to much better state performance in managing macroeconomic policy. And there are at least the beginnings of a middle-class coalition against clientelism and corruption in Brazil and elsewhere, where prosecutions of the notoriously corrupt political class have increased in the 2000s. Brazil today offers a mixed picture, with some excellent ministries and agencies coexisting with highly corrupt and underperforming ones.
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NO MORE WAR

Why was it that interstate war was rare in Latin America compared to Europe and East Asia, and that the wars that occurred did not motivate governments to engage in serious and prolonged state building of the sort that happened in Asia and Europe? There are a number of possible reasons.

The first has to do with the class stratifications already noted, which in Latin America had significant ethnic and racial dimensions. War and violence, as noted earlier, were endemic to Latin America; the difference with Europe lay in the fact that in the nineteenth and twentieth centuries war was all internal rather than between states. Mexico, Argentina, Uruguay, Colombia, Nicaragua, and a host of other countries experienced prolonged internal conflicts that disrupted economies and impoverished their societies. These internal conflicts reflected the bitter social and class divisions that existed. They limited the degree to which elites in any given country were willing to push for total mobilization of the population, since this would entail putting guns into the hands of restive nonelites. The elites themselves were often internally divided into factions based on region, ideology, or economic interest. Social mistrust also limited the degree of loyalty that marginalized populations felt toward the state. In Europe, demands for expanded popular participation came on the heels of war; the rise of the British Labour Party in the 1920s, for example, was in some ways a consequence of the sufferings of the working class in the trenches of World War I. In Latin America, by contrast, elites usually pulled back from interstate conflicts precisely to avoid having to turn to the masses for help.

A second factor has to do with geography. Europe is cut up into geographically defined regions that make it difficult for a single power to dominate the continent as a whole. But within each region, there is open territory that permits the accumulation of substantial economic and military power. There are also large, navigable rivers that enable commerce and communication with inland areas. Latin America by contrast is divided by the spine of the Andes and the dense forests of the tropics, which have physically separated its different parts. Though Venezuela, Colombia, Peru, and Bolivia border on Brazil, none has strong communications links with the largest economy in the region simply because of the difficulty of penetrating the Amazonian jungle. Colombia, Latin America's third-largest country, is so internally divided by Andean cordilleras that its government to this day has trouble projecting power across the whole of its territory, creating havens for guerrillas and drug traffickers. At the beginning of the twenty-first century, not a single road connects Panama to Colombia despite the fact that they used to be part of the same country. Obviously, projecting military power under such circumstances is very difficult.

A third factor has to do with national identity, or rather, the weakness of national identity in many of the region's societies. This too was deeply affected by ethnic and racial diversity. The strong European states that emerged in the nineteenth century were built around a national principle that made language and ethnicity the core of national identity. Part of the reason that Europe in the twentieth century was so violent is that ethnic identities did not correspond to existing political borders and had to be rearranged through war. European war was tightly connected to the nation-building process.

The same could never be true in Peru, Bolivia, Guatemala, and Mexico, where large numbers of Indian and mixed-blood people lived their lives in rural communities largely untouched by the state or its services, and as a consequence felt almost no sense of obligation to it. They in turn were regarded by the European elites at best with indifference and at worst with distrust and hostility. Language, moreover, could not serve as a source of identity that both unified nations and distinguished them from one another, since all of the elites spoke either Spanish or Portuguese, while the nonelites continued to speak Quechua, Aymara, Nahuatl, Mayan, or some other indigenous language. To the present day, the business elites in Guatemala City have virtually nothing in common with the indigenous groups living in the highlands. And indeed, these two sets of actors faced off in a brutal civil war during the 1980s.

A final factor inhibiting Latin American state building was powerful external actors—the United States, Britain, France, and other European powers—who sought to influence developments there. The United States in particular upheld a conservative political and social order in the region, intervening to help topple left-wing leaders such as Jacobo Árbenz in Guatemala and Salvador Allende in Chile. The United States under the Monroe Doctrine also sought to prevent outside powers like Britain and France in the nineteenth century and the Soviet Union in the twentieth from forming alliances with Latin American countries that might have helped both in institution building. As a result of their own experience in a country with historical social mobility, American policy makers are often blind to deeply embedded social stratifications that characterize other societies. The only successful political revolution in the western hemisphere that also resulted in a social revolution was that of Fidel Castro's Cuba in 1959, a revolution that the United States spent the next fifty-plus years trying to contain or reverse.

Should we then regret the fact that Latin America has not seen more violence over the past two centuries, either in the form of massive interstate wars or social revolutions? It goes without saying that the social revolutions that occurred in Europe and Asia were purchased at enormous cost: tens of millions of people killed in purges, executions, and military conflict, and hundreds of millions more displaced, incarcerated, starved to death, or tortured. Political violence, moreover, oftentimes begets only more political violence rather than progressive social change. We would not want to “give war a chance” in Latin America any more than in other parts of the world. These observations should not blind us, however, to the fact that just outcomes in the present are often the result, as Machiavelli noted, of crimes committed in the past.

 

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THE CLEAN SLATE

Exceptions to the materialist account of institutions in Latin America; why Costa Rica didn't become a “banana republic”; why Argentina should have looked like Canada or Australia but regressed instead

The Spanish and Portuguese went to the New World to exploit its resources and brought with them authoritarian political institutions that left a legacy of inequality and poor government up to the present. But while it is possible to spin a larger story of the relationship among geography, climate, and resources to political outcomes at the level of the region as a whole, there were important exceptions and qualifications to this pattern. Certain countries did better than their material endowments would suggest, and others did much worse. All of this points to the fact that material conditions are not the only factors explaining outcomes in the twenty-first century. Human beings make political choices at critical junctures in their history that force their societies onto very different trajectories for better and worse. Human beings, in other words, are agents who have control over their destinies, even as material conditions shape the choices they face.

LA COSTA POBRE

A good example of a country escaping the Latin American birth defect is Costa Rica. It is a small country in Central America of fewer than five million people that is today substantially wealthier than most of its neighbors. Its per capita income in 2011 was over $12,000, compared to its neighbors in Guatemala (less than $5,000), Honduras ($4,000), and Nicaragua ($3,000).
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Many foreigners know it as an ecotourism destination, with its lush tropical rain forests; they may be less aware that it has also been host to multinationals like Intel and Boston Scientific that have set up assembly plants there. Perhaps more significant is what hasn't happened in Costa Rica. Unlike El Salvador, Nicaragua, and Guatemala, there were no military coups, dictatorships, bloody civil wars, death squads, or foreign intervention on the part of the United States, Cuba, or other outside parties for the last sixty years. Rather, it has been a stable democracy since 1948 with competitive elections and regular turnovers of power between political parties. This has been the case despite the fact that Costa Rica's development has been based primarily on tropical agricultural products—coffee and bananas—and that its climate and resource endowments are virtually indistinguishable from those of its neighbors.
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The fact that Costa Rica turned out so differently from the rest of Central America has generated theories and myths as to why this was so. The Costa Ricans themselves argue that they have always had an egalitarian and democratic culture, based on the absence of a landed oligarchy that characterized much of the rest of Spanish America, and that their racial and ethnic homogeneity has contributed to their political stability. There are even cultural hypotheses that trace the country's success to the fact that its early settlers were alleged to be Spanish Marranos (Jews converted to Catholicism).
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There is some truth to at least the first of these explanations. Compared to Guatemala, which was the seat of an important imperial
audiencia
from early in the sixteenth century, Costa Rica was a relative backwater, isolated and unattractive because of its lack of precious metals or exploitable indigenous population. Although Christopher Columbus managed to stop in Costa Rica in 1502, the territory was largely avoided by later Europeans as being too remote—hence the national joke that the country should have been named “Costa Pobre” (poor coast) rather than Costa Rica (rich coast). As the coffee industry grew in the nineteenth century, there tended to be far fewer large estates than in Guatemala and El Salvador, and thus less concentrated political power in the hands of a conservative agrarian oligarchy.
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While African slaves constituted one-sixth of the population in 1800, both they and the indigenous inhabitants soon died out or were assimilated into the broader mestizo population. In this respect it differs sharply from Guatemala, with its large Indian population and high levels of inequality.
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