North Looking South
By John Barham (June 9, 2006)

Is there a future for globalization in Latin America?
A major tenet of globalization is that open markets and the free flow of capital, drawn by competitive labor pools and resources, will provide jobs and raise standards of living in poor countries. However, despite few exceptions, this has not happened in Latin America during the last quarter century of experimentation with free market concepts.

Overall, it is clear that a superabundance of new jobs has not materialized; if anything, regional economies have become less stable. Subsistence farmers have found that it is impossible to compete with the great agricultural conglomerates of the developed world, while manufacturing contracted through international corporations has demonstrated that those who provide the funds that fuel globalization have assumed little or no responsibility for the fair and equitable treatment of the human capital that provides the labor.

At the same time, international organizations, such as the International Monetary Fund, the World Bank and the World Trade Organization, have in many instances overlooked woeful deficiencies of educational and technological underpinnings while foisting on Third World economies policies that have not fostered stability during times of economic crisis.

In reaction, recent political developments have seen a steady increase in the numbers of leftist figures coming to power in Latin America. Most, if not all, strike a common theme of a return to state-run and managed economies that would exercise more control over the influx of foreign capital and dispense with perceived unfair policies imposed by creditor nations.

The growing voices of opposition in Latin America have declared that most economists associated with the advocacy of globalization have labored under the handicap of an ethnocentrism that cannot possibly appreciate the deep cultural roots of poverty plaguing the Third World. Any efforts to overcome deep-seated poverty incompatible with globalization's professed goal of raising standards of living will require dedicated efforts over generations to produce a lasting impact. Critics of globalization are quick to point out that this has not occurred.

The legions of young people who have taken to the streets in Europe and the United States in protest have viewed globalization as a capitalist Trojan horse, a façade of noble and worthy sounding goals that mask the real intent of driving multinational profits on the back of cheap labor while exposing the natural environment of the Third World to considerable risk.

In the two and one half decades during which globalization has been touted in Latin America, job creation and economic growth have actually declined in comparison with the decades prior to 1980. The "Mexican miracle" of the Salinas years was based on smoke and mirrors, and many of the governments latching on to globalization failed to anchor their plunge into free market economics with sound efforts at planning. Thus, much of what was passed off as globalization simply led to further poverty and corruption, offering ample proof that countries whose institutions of law and justice are not firmly grounded by custom and tradition will have difficulty in restraining the negative energies that are often part of the powerful forces unleashed by unfettered capitalism.

Clearly, it is not enough for proponents of globalization to point solely to significant increases in gross domestic product, and this is especially true if the increases are disproportionately reflected in outrageous compensation for CEOs and in soaring profits for stockholders without accompanying improvements in living standards for Third-World populations. Otherwise, globalization will appear to those being "globalized" as a gigantic hoax perpetrated on poor people to deprive them of the sweat of their brows for nothing more than a mess of pottage. 

The movements that have brought anti-free-market politicians to the fore in Latin America have common denominators. Deeply disenchanted by the unfulfilled promises of the 1980s and 1990s, the ranks of the anti-globalists have been swelled by the poor and dispossessed, those whose lot was expressly targeted for improvement by the proponents of globalization. The populist figures who have risen to leadership have come in large part from the lower rungs of society and are virulent in their condemnation of the elites who have traditionally dominated the political scene. They are further distinguished by their denunciation of the United States for its role in promoting a globalization that has increased the bounty of the "haves" while not producing benefits for those in greatest need. Combined with the abject neglect characteristic of the Bush administration, the result has been a growing anti-Americanism throughout Latin America.

Despite the many failures of globalization, there is still a case to be made for the free flow of ideas, labor, technology, products and capital; if it is to be made, it must be made by the moguls of international capitalism who have long dominated the World Bank, the International Monetary Fund and the World Trade Organization. No longer should their deliberations be held in secret conclaves more notable for the violent demonstrations surrounding them than by the progressive ideas and programs that proceed from there. Would it not be better for all concerned if these meetings were transformed into open forums with input from critical areas of the developing world? To do otherwise would amount to simple-mindedly consigning globalization to the dustbin of history as just another failed panacea of an all-too-dysfunctional world.


John Barham, who has had a long career in higher education as an administrator and instructor, has been visiting San Miguel de Allende for more than 18 years. He may be reached at barhamj@missouri.edu.