Rebellion in Equador
by James Petras
Z magazine, April 2000
On January 21 a popular rebellion, led by a coalition of Indians,
peasants, and urban workers, supported by junior military officials
occupied the Parliament, Judiciary, and surrounded the presidential
palace. A three-person junta was established including a leader
of CONAI-the Indian peasant organization-a civilian representing
the middle class, and a junior military officer. President Clinton,
outraged by the popular revolt, immediately intervened, threatening
an economic boycott of Ecuador and ordering the U.S. Embassy in
Quito to pressure conservative generals to act. The popular junta
was overthrown and Vice-President Noboa of the discredited regime
was installed in power. Noboa's first pronouncement was that he
would dollarize the economy, meet foreign debt obligations, and
impose "order and discipline," beginning with mass arrests
of peasants and trade union activists.
On the surface, Ecuador appears as the typical "comic
opera" of a banana republic with six presidents in four years.
The reality is that Ecuador reflects the profound crises resulting
from the neo-liberal policies promoted and enforced by Washington
and Brussels throughout the Third World. For the past decade,
Ecuador has had a series of neo-liberal presidents who have faithfully
applied the austerity and free market prescriptions of the IMF
and World Bank. The result is a precipitous decline of living
standards, 60 percent rate of inflation, an economic depression
(-7 percent decline in 1999), first world prices, and third world
wages. Over the decade, each crisis required new loans, greater
austerity, and more privatizations of lucrative enterprises. Unemployment
and underemployment reached 80 percent of the labor force. Rising
costs and declining prices resulting from cheap foreign imports
hit Indian and peasant communities hard. Ecuador's elite, on the
other hand, speculated on scarce commodities, pillaged the state
treasury, and transferred World Bank loans, amounting to millions
of dollars, to overseas accounts in Miami. Presidential candidates
who pledged to end corruption and provide employment, in their
electoral campaigns, once in power reinforced the neo-liberal
agenda. General strikes and mass demonstrations became the norm,
as the populace grew totally disenchanted with an electoral system
that only provided a choice of oligarchies subservient to Washington.
By mid-1999 the Ecuadorian treasury was empty, the economy bankrupt.
President Jamil Mahuad could not squeeze the impoverished populace
further. Ecuador reneged on its foreign debt. Despite mass poverty
and growing discontent the international financial institutions
insisted on new austerity measures and regressive fiscal policies.
Mahuad obeyed and went one step further in formalizing the neo-colonial
relationship. Mahuad decided to formally put Ecuador under direct
control of the U. S. Central Bank by dollarizing the economy.
The Ecuadorian people realized the consequences: the cost of basic
foods and necessities would rise to U.S. Ievels while the Ecuadorian
population would continue to be paid in a devalued local currency
(sucre). In one day, January 6, the sucre fell 17 percent, 29,000
to the dollar. The result was the popular rebellion followed by
the U.S. intervention via the military and the restoration of
a client regime.
Popular disgust with corruption and servility of the last
six presidents has led the vast majority of the Ecuadorian population
to seek extra-paramilitary forms of political expression. The
U.S., fearful of popular democratic movements intervened through
the military to overthrow the popular junta. The events in Ecuador
in January reveal the real political power behind the neo-liberal
electoral facade: U.S. imperial power and its local client generals.
Ecuador also demonstrates that the popular movements have
the power to depose neo-liberal presidents. Peasant-Indian movements
have the capacity to catalyze the urban poor, the trade unions,
and even sectors of the sub-officials in the military and lower
clergy in the Church. While it is true that Washington and its
generals have temporarily imposed a new president, Gustavo Noboa
(referred to in Washington as "nobody"), it is also
true that he is following the exact same policies that provoked
the popular rebellion that overthrew his predecessors. While the
Noboa regime is arresting hundreds of activists, it is creating
the conditions for a further radicalization among the people.
As one popular leader stated, "Our mistake was to think we
could carry out a peaceful transformation. Next time we will have
to resort to arms."
It would be a mistake to consider Ecuador as some exceptional
circumstance. The electoral buffoonery of the political elites
in Ecuador and elsewhere is a sideshow to the real drama of millions
of citizens effectively excluded from the key economic decisions
that affect their lives. Dollarization, the symbol and substance
of recolonization, provokes a popular affirmation of national
resistance and social solidarity. The popular rebellion in Ecuador
demonstrates the strength and weakness of social movements. The
lessons of moving beyond protest to political power are being
learned in all the neighboring countries, especially Colombia,
Brazil, and Venezuela. The events in Ecuador suggest that the
people in Latin America are reaching the limits of depredation.
Clinton's speeches in praise of free market prosperity are just
the kind of obscene provocation that provokes anger and rebellion
among the great mass of unemployed in the streets and plazas of
Latin America. It is a truism of history that rulers do not expect
revolutions until they happen. The U.S. may have won the initial
battle but the bitter Indians have let the Ecuadorian elite know
that the war is not over.
James Petras has written numerous books and articles, and
teaches sociology at SUNY, Binghamton.
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