Historical Perspectives on Latin American and East
Asian Regional Development
By Noam Chomsky
There was a meeting on the weekend of December 9-10 in
Cochabamba in Bolivia of major South American leaders.
It was a very important meeting. One index of its
importance is that it was unreported, virtually
unreported apart from the wire services. So every
editor knew about it. Since I suspect you didn't read
that wire service report, I'll read a few things from
it to indicate why it was so important.
The South American leaders agreed to create a high-
level commission to study the idea of forming a
continent-wide community similar to the European Union.
This is the presidents and envoys of major nations, and
there was the two-day summit of what's called the South
American Community of Nations, hosted by Evo Morales in
Cochabamba, the president of Bolivia. The leaders
agreed to form a study group to look at the possibility
of creating a continent-wide union and even a South
American parliament. The result, according to the AP
report, left fiery Venezuelan President Hugo Chavez,
long an agitator for the region, taking a greater role
on the world stage, pleased, but impatient. It goes on
to say that the discussion over South American unity
will continue later this month, when MERCOSUR, the
South American trading bloc, has its regular meeting
that will include leaders from Brazil, Argentina,
Venezuela, Paraguay and Uruguay.
There is one -- has been one point of hostility in
South America. That's Peru, Venezuela. But the article
points out that Chavez and Peruvian President Alan
Garcia took advantage of the summit to bury the
hatchet, after having exchanged insults earlier in the
year. And that is the only real conflict in South
America at this time. So that seems to have been
The new Ecuadorian President Rafael Correa proposed a
land and river trade route linking the Brazilian Amazon
Rainforest to Ecuador's Pacific Coast, suggesting that
for South America, it could be kind of like an
alternative to the Panama Canal.
Chavez and Morales celebrated a new joint project, the
gas separation plant in Bolivia's gas-rich region. It's
a joint venture with Petrovesa (PDVSA, Petroleos de
Venezuela, SA. Pronounced "pedevesa"), the Venezuelan
oil company, and the Bolivian state energy company. And
it continues. Venezuela is the only Latin American
member of OPEC and has by far the largest proven oil
reserves outside the Middle East, by some measures
maybe even comparable to Saudi Arabia.
There were also contributions, constructive,
interesting contributions by Lula da Silva, Brazil's
president, Michelle Bachelet of Chile, and others. All
of this is extremely important.
This is the first time since the Spanish conquests, 500
years, that there have been real moves toward
integration in South America. The countries have been
very separated from one another. And integration is
going to be a prerequisite for authentic independence.
There have been attempts at independence, but they've
been crushed, often very violently, partly because of
lack of regional support. Because there was very little
regional cooperation, they could be picked off one by
That's what has happened since the 1960s. The Kennedy
administration orchestrated a coup in Brazil. It was
the first of a series of falling dominoes. Neo-Nazi-
style national security states spread across the
hemisphere. Chile was one of them. Then there were
Reagan's terrorist wars in the 1980s, which devastated
Central America and the Caribbean. It was the worst
plague of repression in the history of Latin America
since the original conquests.
But integration lays the basis for potential
independence, and that's of extreme significance. Latin
America's colonial history -- Spain, Europe, the United
States -- not only divided countries from one another,
it also left a sharp internal division within the
countries, every one, between a very wealthy small
elite and a huge mass of impoverished people. The
correlation to race is fairly close. Typically, the
rich elite was white, European, westernized; and the
poor mass of the population was indigenous, Indian,
black, intermingled, and so on. It's a fairly close
correlation, and it continues right to the present.
The white, mostly white, elites -- who ran the
countries -- were not integrated with, had very few
relations with, the other countries of the region. They
were Western-oriented. You can see that in all sorts of
ways. That's where the capital was exported. That's
where the second homes were, where the children went to
university, where their cultural connections were. And
they had very little responsibility in their own
societies. So there's a very sharp division.
You can see the pattern in imports. Imports are
overwhelmingly luxury goods. Development, such as it
was, was mostly foreign. Latin America was much more
open to foreign investment than, say, East Asia. It's
part of the reason for their radically different paths
of development in the last couple of decades.
And, of course, the elite elements were strongly
sympathetic to the neoliberal programs of the last 25
years, which enriched them -- destroyed the countries,
but enriched them. Latin America, more than any region
in the world, outside of southern Africa, adhered
rigorously to the so-called Washington Consensus,
what's called outside the United States the neoliberal
programs of roughly the past 25 or 30 years. And where
they were rigorously applied, almost without exception,
they led to disaster. Very striking correlation. Sharp
reduction in rates of growth, other macroeconomic
indices, all the social effects that go along with
Actually, the comparison to East Asia is very striking.
Latin America is potentially a much richer area. I
mean, a century ago, it was taken for granted that
Brazil would be what was called the "Colossus of the
South," comparable to the Colossus of the North. Haiti,
now one of the poorest countries in the world, was the
richest colony in the world, a source of much of
France's wealth, now devastated, first by France, then
by the United States. And Venezuela -- enormous wealth
-- was taken over by the United States around 1920,
right at the beginning of the oil age, It had been a
British dependency, but Woodrow Wilson kicked the
British out, recognizing that control of oil was going
to be important, and supported a vicious dictator. From
that point, more or less, it goes on until the present.
So the resources and the potential were always there.
In contrast, East Asia had almost no resources, but
they followed a different developmental path. In Latin
America, imports were luxury goods for the rich. In
East Asia, they were capital goods for development.
They had state-coordinated development programs. They
disregarded the Washington Consensus almost totally.
Capital controls, controls on export of capital, pretty
egalitarian societies -- authoritarian, sometimes,
pretty harsh -- but educational programs, health
programs, and so on. In fact, they followed pretty much
the developmental paths of the currently wealthy
countries, which are radically different from the rules
that are being imposed on the South.
And that goes way back in history. You go back to the
17th century, when the commercial and industrial
centers of the world were China and India. Life
expectancy in Japan was greater than in Europe. Europe
was kind of a barbarian outpost, but it had advantages,
mainly in savagery. It conquered the world, imposed
something like the neoliberal rules on the conquered
regions, and for itself, adopted very high
protectionism, a lot of state intervention and so on.
So Europe developed.
The United States, as a typical case, had the highest
tariffs in the world, most protectionist country in the
world during the period of its great development. In
fact, as late as 1950, when the United States literally
had half the world's wealth, its tariffs were higher
than the Latin American countries today, which are
being ordered to reduce them.
Massive state intervention in the economy. Economists
don't talk about it much, but the current economy in
the United States relies very heavily on the state
sector. That's where you get your computers and the
internet and your airplane traffic and transit of
goods, container ships and so on, almost entirely comes
out of the state sector, including pharmaceuticals,
management techniques, and so on. I won't go on into
that, but it's a strong correlation right through
history. Those are the methods of development.
The neoliberal methods created the third world, and in
the past 30 years, they have led to disasters in Latin
America and southern Africa, the places that most
rigorously adhered to them. But there was growth and
development in East Asia, which disregarded them,
following instead pretty much the model of the
currently rich countries.
Well, there's a chance that that will begin to change.
There are finally efforts inside South America --
unfortunately not in Central America, which has just
been pretty much devastated by the terror of the '80s
particularly. But in South America, from Venezuela to
Argentina, it's, I think, the most exciting place in
the world. After 500 years, there's a beginning of
efforts to overcome these overwhelming problems. The
integration that's taking place is one example.
There are efforts of the Indian population. The
indigenous population is, for the first time in
hundreds of years, in some countries really beginning
to take a very active role in their own affairs. In
Bolivia, they succeeded in taking over the country,
controlling their resources. It's also leading to
significant democratization, real democracy, in which
the population participates. So it takes a Bolivia --
it's the poorest country in South America (Haiti is
poorer in the hemisphere). It had a real democratic
election last year, of a kind that you can't imagine in
the United States, or in Europe, for that matter. There
was mass popular participation, and people knew what
the issues were. The issues were crystal clear and very
important. And people didn't just participate on
election day. These are the things they had been
struggling about for years. Actually, Cochabamba is a
symbol of it.
This is a lightly edited and excerpted version of Noam
Chomsky's December 15, 2006 talk to a Boston meeting of
Mass Global Action following a recent trip to Chile and
Noam Chomsky's most recent book is Perilous Power: The
Middle East and U.S. Foreign Policy: Dialogues on
Terror, Democracy, War and Justice.