Historical Perspectives on Latin
American and East Asian Regional Development
by Noam Chomsky
www.zmag.org/, December 24, 2006
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 smoothed over.
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
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 one.
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
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 that.
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. Very rich.
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
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
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 Peru.
Noam Chomsky's most recent book is Perilous Power: The Middle
East and U.S. Foreign Policy: Dialogues on Terror, Democracy,
War and Justice.
Noam Chomsky page