#hotLatinAmericatakes from a busy weekend

It was a busy weekend in Latin America and I have a few quick takes on some of the biggest things that happened.

  1. Last week, as poll after poll showed Daniel Scioli, the presidential candidate for Argentina’s ruling Frente para la Victoria (FPV, Victory Front) coalition within striking distance of winning the 40 percent plus a ten percent margin of victory necessary for a first round victory, I wondered on Twitter what structural factors would be required for a Peronist candidate to not be favored in a nationwide election. Essentially, if 30 percent inflation, rising unemployment and poverty and stagnant growth weren’t enough to prevent the FPV from coasting to victory, what would be? To some degree, Sunday’s results, with Scioli winning less than 37 percent of the vote with only a 2.5 percent margin over his closest competitor, Buenos Aires mayor Mauricio Macri of the center-right PRO party, indicated that the built-in pro-Peronist margin isn’t nearly as significant as the polls seemed to indicated.

    Of course, all of this needs to be taken with a grain of salt. Scioli is still very likely to win, for reasons both above board and not. For one, the Peronist advantage is still significant, and third place finisher, dissident Peronist Sergio Massa’s 22 percent of the electorate is likely to break more than 50 percent toward Scioli, meaning Marcri would need to dominate the swing voters from the other first round candidates to overcome that margin. Additionally, Scioli, who is the outgoing governor, will probably improve his position in the massive province of Buenos Aires in the second round. In the first round, he was probably pulled down a bit by the FPV candidate for governor, Aníbal Fernández, who is among the most unpopular politicians in the country. Fernández lost to PRO candidate María Eugenia Vidal, taking the governorship out of Peronist hands for the first time in 30 years. Without Fernández’s toxic brand on the ballot, Scioli will improve his position at least slightly, pushing his margin even closer to 50 percent. Beyond that, Scioli will benefit from Cristina Kirchner’s willingness to use the full resources of the state to push his candidacy. If she was willing to use a cadena nacional to transparently campaign for her sister-in-law’s gubernatorial campaign in Santa Cruz, there is little reason to imagine that Scioli won’t benefit from a similar treatment.

  2. In Venezuela, Franklin Nieves, one of the prosecutors who led the trial against Leopoldo López that culiminated in a nearly 14 year prison sentence, has fled Venezuela and, in an interview with the Wall Street Journal, denounced the entire proceeding as a sham trial, claiming he was pressured by his superiors. To anyone even vaguely aware of the case, this was obvious from the start. López was convicted of using subliminal messages to incite his followers to commit acts of violence during nationwide protests in February, 2014. Beyond the laughably ridiculous charges, López was not allowed to present evidence in his favor or even call witnesses. Moreover, one of the key prosecution witnesses, a linguist who was supposed to “prove” how his speech calling for peaceful protest actually was inciting violence, testified that was not the case.

    The upshot of this is that it casts into further relief what most anyone paying attention to Venezuela already knew; the Venezuelan judiciary is subservient to the executive and Leopoldo López is a political prisoner convicted in a show trial. That said, it is unlikely to change anything on the ground in Venezuela. The Venezuelan government has already branded Nieves as under the influence of “foreign factors” and it’s unlikely anyone who didn’t already know the López trial was a sham suddenly cares about that more than the economic crisis currently afflicting the country. The more likely effect of this is that it will continue to erode Venezuela’s support abroad. Every time someone from within the government flees the country and confirms the worst things about what’s going on, it becomes harder for Venezuela’s democratic enablers like Brazil to continue backing them and covering for them in organizations like the OAS and Unasur.

  3. For their story on Guatemala’s presidential runoff on Sunday, The Washington Post has a suitably click-baity headline: “The ‘Donald Trump of Guatemala’ was just elected president”. This isn’t the worst thing you’ll see on Latin America in a US newspaper, but it’s incredibly facile. Jimmy Morales shares some superficial similarities to Trump; a celebrity-cum-politician who has never been elected to office and represents an anti-establishment option. However, while Trump has run on a platform that focus on white resentment politics (anti-immigrant, pro-welfare state for the “right” people, nationalist economic policy), Morales’s appeal comes from his anti-corruption platform and an appeal among Guatemala’s indigenous majority. He certainly has his red flags, especially since the party he represents is closely linked with military officers who fought in Guatemala’s long and bloody civil war, which is considered by many experts to have been a genocide. What he is not is a Donald Trump-like figure and it’s annoying that they’d misrepresent him so badly simply for the “Donald Trump” clicks.

When in Caracas, don’t act like those in charge

Yesterday I attended an event at the Inter-American Dialogue entitled “What’s in Store for Venezuela?” that happened to coincide rather closely with the Tribunal Supremo de Justicia (TSJ) in Venezuela throwing out Henrique Carpiles’ lawsuits alleging fraud in the April 14th elections and then fining him for having the temerity file them in the first place. That the court threw out the lawsuits is hardly surprising, though the ferocity with which they did so perhaps is. I highlight this because both speakers, Javier Corrales of Amherst University and Dan Restrepo of the Center for American Progress, felt it was a positive sign that the opposition in Venezuela has not abandoned democratic politics, while fretting that other governments in the region were not committed to supporting democratic politics in the region. Meanwhile, Francisco Toro argues that the TSJ ruling marks the effective end to democratic politics under chavismo and that the future of the opposition depends on its ability to function in a non-democratic world. I actually agree with all three of them. The abject failure of the Inter-American system to stand up to the democratic erosion in Venezuela over the last decade and a half has left Venezuela’s democratic opposition totally isolated and empowered chavismo to become ever more openly autocratic.

As in any situation like this, the eventual solution will have to be domestic; no one can impose its will on Venezuela to force it to become more democratic. That said, Latin American governments have largely either tacitly approved of Venezuela’s democratic backsliding or actively encouraged or rewarded it. For example, Venezuela has been accepted into Mercosur thanks to Paraguay’s suspension as a result of impeaching its president in a hasty, but legal process. All of this happened during the middle of a presidential campaign in which the opposition was practically barred from the airwaves while Hugo Chávez abused his power to invoke cadenas to take over the airwaves for hours at a time to campaign. More tacit approval can be seen in the non-reaction of Latin American governments this January when the TSJ ruled that the legally mandated presidential inauguration could be postponed while Chávez was in Cuba receiving treatment for the cancer that eventually killed him. Similarly, when Chávez died and Nicolás Maduro inherited the presidency before the April 14th special elections, despite a clear constitutional mandate (article 233) that the temporary presidency pass to the head of the National Assembly, governments around the region said nothing. And these are just a few examples from the past year I could mention, notwithstanding the dozens of other instances.

Any criticism of how the Inter-American community has reacted to the deterioration of Venezuelan democracy must be tempered by acknowledging that the existing democracy promotion framework is overwhelmingly biased toward incumbent executives. Part of this is due to the fact that the impetus for developing the framework was the return to democracy of most of Latin America in the 1980s following two decades of near constant military intervention in countries across the region, mainly in the form of coups. Moreover, both within the Organization of American States (OAS) and in nearly every other regional grouping with a democratic mandate, it was executives who designed the mechanisms designed to protect democracy, and unsurprisingly, they designed mechanism that help protect incumbent executives much more than democratic systems of government as a whole. This means, for instance, that only the executive has authority to summon the OAS in the event of a constitutional breakdown. Hardly much of a safeguard against an over wielding executive.

It is therefore hardly surprising that leaders from around the region have been reluctant to embrace Venezuelan opposition forces, both National Assembly members and Capriles. Many presidents, both from the right, and more commonly in recent times, from the left, have looked to amass as much power as possible, often blurring the lines between the different branches of power in a way similar to what chavismo has done in Venezuela. The current status quo suits all current presidents quite nicely whereas embracing the Venezuelan opposition’s cause necessarily means upsetting that system and, potentially, exposing oneself to the risk that democracy promotion will mean protecting separation of powers and rule of law rather than incumbent presidents. Combined with the fact that a number of presidents in the region openly sympathize with the chavista government, or have significant constituencies within their governing (or, in Michelle Bachelet’s case, her campaign coalition) who do and the lack of response makes sense.

This leaves the opposition in Venezuela in a terrible place. On the one hand, they face a government that controls all the levers of power and is increasingly less restrained—either by arrogance, or more likely desperation—by any need to conceal its authoritarian tendencies, and therefore impervious to legal challenges. On the other hand, it receives minimal support from the region’s other governments, despite their professed commitment to democracy, leaving it with no means of legally coercing a change out of the chavista government via outside pressure. However, elevating a leadership more comfortable operating outside a democratic, legal framework, as Toro seems to suggest, risks winning the battle against chavismo at the expense of losing the war to save Venezuelan democracy. Those types of leaders might be effective at bringing down the chavista state, but are also the types of leaders disposed to becoming authoritarian once in power.

During the Q&A at the event yesterday, Javier Corrales was accused of being too optimistic by one of the attendees. I will confess, despite everything I have just written, I remain optimistic that the strategy Toro seems to have become resigned to will not be necessary. I am deeply pessimistic about the state of the Venezuelan economy, and bullish on the idea that oil prices are likely to stagnate over the next few years, which will, as Corrales mentioned, force the chavista government, which has heretofore relied on ever rising prices, to deal for the first time with the politics of economic adjustment. I do not believe that Maduro possesses the political talent to navigate that type of challenge, nor do I believe that Venezuela has the institutional capacity to do so. In short, despite lacking a legal avenue to challenge chavismo, the opposition may still be best suited to maintaining its current strategy because the chavista state is so fragile that it’s likely to collapse on itself in the face of any serious economic challenge. It’s a cynical type of optimism, but surely better than the alternative.

Evo, Rafa and the SIDH

An interesting piece from Ecuador about joint declarations from Evo Morales and Rafael Correa about attempts to reform the Inter-American Human Rights System. A couple of quick thoughts:

  1. Anytime leaders who count among the dozen who back Bashar Assad in Syria talk about the need to reform the SIDH (Sistema Interamericana de Derechos Humanos), I get suspicious. That said, they do make a very good point about the hypocrisy of Inter-America Commission on Human Rights being based out of Washington, DC when the United States hasn’t ratified the treaty.
  2. Until a Latin American leader explains how forcing Kelpers (people who live in the Falklands) to become part of Argentina against their will isn’t tantamount to colonizing the islands, I will remain firmly on the side of the Kelpers’ right to self-determination over Argentina’s territorial claims.
  3. In the piece, Correa and Morales are reported as mentioning three separate regional organizations through which they want to advance their reforms. I think this is symptomatic of a disease that runs throughout the region’s governments of creating lots of different organizations (or ministries or commissions) that all do roughly the same thing. I have difficulty imagining how spreading out the functions of human rights protection across the OAS, Unasur, ALBA and CECLAC (Comunidad de Estados Latinoamericanos y Caribeños) will be more effective than centralizing them into one or two of those organizations… unless the whole point is to dilute the power of human rights enforcement in the region.

Merco-sucks, continued

Today I attended an event put on by the Americas Program at CSIS that was very provocatively called “Paraguay- Leaving Mercosur?” where the Paraguayan ambassador the United States Fernando Pfannl Caballero spoke. The short answer, is that, no Paraguay is not going to abandon Mercosur. However, the underlying subtext of his comments is that while Paraguay isn’t eager to leave, it also isn’t all that committed to the project and is deeply frustrated with its co-member states.

Paraguayan ambiguity regarding its membership is threefold. Legally, Paraguay feels—justifiably—that it never should have been suspended in the first place. Ambassador Pfannl complained that, notwithstanding the fact that Fernando Lugo’s impeachment was carried out within the constitutional framework and therefore not a constitutional breach, Paraguay was not given a chance to defend itself in the process whereby it was suspended from Mercosur. Moreover, while Paraguay was suspended for violating the democratic clause, a far more egregiously undemocratic regime in Venezuela was allowed in as a result of removing Paraguay and thereby negating its two-year refusal to ratify Venezuela’s entrance. The Paraguayan government feels that the whole process was illegal under international law, and feels that, as a small country in a club of big countries, it needs assurance that there are legal processes that will protect it in the future before it rejoins.

Economically, Paraguay perceives Mercosur as not providing enough economic benefit to justify the restrictions it puts on its ability to conduct bilateral and multilateral economic policy outside of the organization. Since Mercosur’s bylaws technically restrict member states from negotiating trade agreements outside of Mercosur, Paraguay is hamstrung in its ability to expand its trading options. In theory, this shouldn’t matter, as Mercosur would be actively perusing these types of agreements as a unit. However, in practice, Brazil and Argentina have been intransigent in these processes, particularly as protectionist impulses have gained prominence within each government. In this light, Paraguay sees its suspension as a way to explore other avenues economically and perhaps gain leverage to carve out exceptions for itself upon returning, in a similar way to Uruguay being allowed to negotiate a free trade agreement with Mexico. So far, this has manifested in trade talks with Mexico and observer status in the Pacific Alliance.

Finally, there is a large degree of nationalism at play in Paraguay’s behavior. Though largely unknown outside Latin America, the War of the Triple Alliance, which devastated Paraguay, remains salient to this day and Paraguayans are extremely sensitive to any perception that Brazil, Argentina and Uruguay might be ganging up on them. On top of that, Paraguayan relations with Venezuela are extremely tense. Paraguay has accused Venezuela of supporting terrorist groups in Paraguay’s northern departments through its connections with the FARC and Nicolás Maduro was declared persona non grata by both houses of the Paraguayan Congress following the Lugo impeachment, when he was filmed speaking with Paraguayan generals and accused of encouraging the military to step in on Lugo’s behalf. In effect, Paraguay feels deeply wronged by Brazil, Uruguay and Argentina, in a way that evoked painful memories of the War of the Triple Alliance and also allowed a country that Paraguay has accused on meddling in its internal affairs into the group.

All of this reinforces the points I already made about Mercosur last week. Namely, it is an organization with a clear goal—to establish a customs union on the path toward creating a common market—whose most important members are ambivalent or worse toward that idea. There are tremendous economic gains from liberalizing within the bloc—something that Paraguay in particular, and Uruguay to a lesser extent seem eager to pursue—yet the trend is away from liberalization, with an institutional framework that prevents member states from striking out on their own. The fact that the poorest member of the bloc—who presumably had a lot to gain from access to Brazil and Argentina’s giant markets—is dragging its feet on returning to Mercosur says a lot about how effective it has been.

Merco-sucks

The recent rapprochement between Mercosur (Southern Common Market) and suspended member state Paraguay appear to have hit a roadblock that will delay Paraguay’s reentry into the organization until next year at the earliest. Following the controversial impeachment of former president Fernando Lugo, Brazil, Argentina and Uruguay suspended Paraguay from the organization for violating its democratic charter. The move allowed Venezuela to finally become a full member as Paraguay’s senate could no longer block its admittance into the group. Now, Paraguay is refusing to rejoin the group so long as Venezuelan president Nicolás Maduro holds the rotating presidency, arguing that since Paraguay hasn’t yet approved Venezuela’s membership, it could not hold the presidency. This latest spat helps to highlight the unfortunate missed potential of Mercosur, an economic bloc with so much potential that often behaves in direct opposition to its founding, and very ambitious goals.

Mercosur was established in 1991 with the intention of eventually evolving into a common market akin to the European Common Market that eventually became the European Union. In the 1990s, trade within the group grew quickly and it looked like Mercosur could soon become an important economic block. However, since then, Mercosur is defined more by its failure to reach its potential than by its achievements. While the customs union was successfully established, little significant progress has been made toward a deeper economic integration, let alone a full-fledged common market. Trade between the member countries has grown dramatically among the four original members—averaging more than 4 percent annual growth since 1994 by UN COMTRADE statistics. However, that also took place during a period where Latin America’s trade in general was growing rapidly as a result of neoliberal reforms and was starting from an exceptionally low point after decades of Import Substitution Industrialization had closed off their economies.

Most damagingly, the member states have been all too willing to renege on their Mercosur commitments when it benefits when it will provide short-term economic or political boosts at home. For instance, the Kirchner governments in Argentina allowed environmentalist groups opposed to two pulp mills in Uruguay to blockade one of the crossings between the two countries off and on for years until Argentina finally lost its case in the International Court of Justice in 2010. In a similar vein, following Brazil’s devaluation in 1999, Argentina placed a tariff on Brazilian steel to forestall the deleterious effects of a suddenly more competitive Brazilian car industry on Argentine markets. More broadly, Paraguay and Uruguay have often complained of asymmetrical access to the larger Brazilian and Argentine markets, particularly as both have reverted to increasingly protectionist policies over the past few years and retreated into bilateral economic agreements that exclude their smaller neighbors.

Venezuela’s adhesion to the group was, in many ways, the culmination of Mercosur’s failure. Most conspicuously, Venezuela, first under Hugo Chávez, and now under Nicolás Maduro, has been Latin America’s leading voice in opposition to free trade. For an organization that purported to be working toward a common market (i.e. completely free trade within the member states), allowing the country that had spent a decade working to undermine free trade seemed incongruous at best. This played no small part in Paraguay’s resistance to ratifying Venezuela’s membership. How could a group attempting to increase free trade admit a member so diametrically opposed to the concept?

Moreover, that Fernando Lugo’s impeachment was sufficient to warrant a suspension from Mercosur for violating its democratic principles, but that Venezuela was allowed entrance in spite of its complete degradation of rule of law showed how hollow its commitment to democracy really is. The Ushuaia Protocol establishes Mercosur’s commitment to democracy and procedures for dealing with a “rupture in the democratic order.” As Javier El-Hage argued at the time, it is difficult to argue what happened to Lugo was a disruption in the democratic order considering the margins by which both houses voted to impeach him and the fact that it was conducted within the letter of Paraguayan law—if not its spirit. However, suspending Paraguay allowed Mercosur to backdoor Venezuela’s ascension into the organization; a cruel irony considering the Venezuelan government’s systematic disregard for its own constitution.

With Argentina continuing to close its economy in response to economic troubles, Venezuela still being run by chavistas and Brazil’s slowing growth and ambivalence toward the economic wellbeing of its co-members, it’s difficult to foresee a medium-term scenario where Mercosur returns to its roots and works to increase economic openness among its member states.