As Europe struggles to deal effectively with the economic crisis and stares a lost decade in the face, radically different alternatives are urgently needed.
The ideas from the right of the political spectrum, most notably the commitment to unrestrained free market capitalism, not only caused the crisis, but are now exacerbating it through cuts and privatisations that damage the wider economy. They offer no way forward.
The solutions will have to come from progressive movements. But the economic depression has exposed a weakness. Having to a large degree ceded to the right’s idea of the supremacy of the market, much of the social democratic left in Britain and wider Europe has been unable to offer serious alternatives to austerity. The right has had the left in check-mate.
Where then can progressives gain the confidence, inspiration and radically different ideas that are necessary to return to growth and build a more equal society ?
Attention should be turned to Latin America. The mood at the São Paulo Forum, a gathering of Latin American left parties and social movements that I attended earlier this month, was in complete contrast to Europe. Under the slogan ‘the people of the world against neo-liberalism and for peace’, the conference was brimming with ideas – a confidence gained from successfully governing their countries and mobilising vast swathes of the population against free market orthodoxy.
Around 100 parties from 20 Latin American and Caribbean countries came together to discuss how to move beyond the free market capitalism that by the turn of the century, under right wing governments, had left nearly half of the population of Latin America, more than 200 million people, in poverty . As Walter Pomar of the Brazilian Workers Party – the party of former President Lula and President Dilma – explained, at the time of the first Forum in 1990 there was just one left party in government on the continent, in Cuba. It was against this backdrop that the São Paulo Forum was established with the objective of debating the new international political situation following the collapse of the Berlin Wall and arguing for alternatives to neoliberalism. The so-called Washington Consensus was then being pushed as the only way forward and the apparent triumph of capitalism was even being described as the end of history.
Today in Latin America, the political panorama could not be more different. Progressive governments predominate and ideas hold sway that have long been marginalized amongst the left in Europe such as the nationalisation of strategic economic sectors to foster social development, as we have seen in Argentina recently.
This shift stems from people’s struggles and experiences gained over thirty years. First this was against dictatorships and then against brutal free-market ‘shock therapy’ which outstrips anything even currently seen in Europe. Latin America became a laboratory for testing the neoliberal model that today predominates in Europe. In Latin America though it was often imposed at the barrel of a gun – most infamously in Chile where the popular Allende government was violently overthrown by the US-backed General Augusto Pinochet.
Resistance by the Latin American left created movements and leaders that today command huge support and have been governing successfully across the continent for the past decade. As former Brazilian President Lula said in his message to the Forum : "Progressive governments are changing the face of Latin America. Thanks to them, our continent is developing rapidly, with economic growth, job creation, distribution of wealth and social inclusion. Today, we are an international reference of successful alternative for neo-liberalism."
In Venezuela where this year’s Forum was held, neoliberalism left the country poorer in income per head in 1998, when President Hugo Chavez was first elected, than it had been in 1960. Today poverty, which had peaked at 70% in the mid 1990s, has been slashed to 27% in 2011, while extreme poverty has fallen to 7%. Venezuela’s rejection of neoliberal orthodoxy has resulted in five million Venezuelans being lifted out of poverty and three million from extreme poverty since 1998 . Venezuela’s on-going challenge to neoliberal austerity includes a staggering 250,000 social houses being built in the last 18 months as part of a huge fiscal stimulus that has got the economy back on track after worldwide recession hit it hard. This house building scheme has driven a rapid expansion in the construction sector which grew 29.6% in the first quarter of 2012, compared to a year earlier, and made an important contribution to the overall growth of 5.6%. Such a policy is clearly relevant to Britain.
As the US economist Mark Weisbrot has highlighted, in Bolivia economic growth has been higher than at any time in the last 30 years since left wing President Evo Morales took office in 2006. Key to this has been expansionary fiscal policy and control over national resources, especially the hydrocarbons sector. That this was achieved in one of the regions poorest countries shows that what is lacking in Europe is political will not economic resources.
Likewise in Brazil, which hosted the first ever São Paulo Forum, governments of the left have turned the nation into a serious economic power after decades of underachievement and the country’s deep inequality is now being tackled. In Ecuador, there are innovative mixes of environmental and economic development policies including proposals to avoid greenhouse emissions and protect indigenous communities by leaving oil underground.
Across the continent a form of integration and social solidarity is taking place which contrasts sharply with the punishment meted out to the people of Greece, Ireland and elsewhere by EU diktats that serve only financial interests. Nowhere is this difference in approach starker than with Operation Miracle, a joint programme that combines Venezuela’s oil resources with Cuba’s health system to provide free eye operations to restore the sight of poor people unnecessarily blinded by cataracts and other treatable conditions. Since its creation in 2004 more than 1.5 million people have benefited across Latin America and the Caribbean. Even Mario Teran, the man who shot dead Che Guevara, had cataracts removed and his eyesight restored in 2007.
There are real opportunities for progressives in Europe to learn from these experiences and the Latin American parties involved in the Forum seek to build bridges. The preliminary Forum document stated it would ‘support the efforts made by the European left wing to overthrow the neoliberal paradigm’ and ‘use our experience in Latin America’ to help the European left and ‘to prevent the current situation from being politically capitalised on by the extreme right’ . Already some European political forces that are completely opposed to cuts and to replacing the free-market capitalism with something more advanced are building strong links. Jean-Luc Melanchon, recent Presidential candidate of the Left Front in France, for example, attended the conference, as did senior representatives from Greek anti-austerity party Syriza.
With Latin America rising in importance in world affairs – as evidenced by Brazil’s place in the so called BRIC economies – the old ways of thinking about the continent will have to change. Today Latin America should be considered the most advanced place in the world for progressive politics and Europeans have everything to gain by learning from this development.