The Three Americas

Although in the United States we call our country "America" by historical tradition, we are actually part of a much larger and complex continent that bears the same name.

The Americas  comprise three geographical divisions -North, Central and South- with 1.1 billion inhabitants, distributed between North America (539 million) with 3 countries, Central America ( 46 million ) with 7 countries and South America (422 million) with 12 countries, respectively.

Their languages, history, culture and standards of living vary widely, from the most advanced and developed (US, Canada) to the poorest and most underdeveloped of the world (Haiti).

Brazilian anthropologist Darcy Ribeiro (1992-1997) distinguished the Americas not by its geographic location nor its language, but for its colonization. 

He distinguished three basic groups or "peoples" according to the history and evolution before and after colonization and independence: 

1. the testimony peoples, that are mostly of indigenous origins and remain strongly attached to such ancestry -Mexico, Bolivia, Peru, Paraguay- 
2. the new peoples, that were formed by forced, mostly slave-work immigration from Africa and Asia and became characterized by such ancestry -Caribbean, Central America, Brazil and the African American culture in the US- and 
3. transplanted peoples , which replaced with mostly European colonizer the aboriginal population -Canada and US on the North, Argentina, Uruguay and Chile on the South-

Ribeiro considered self-determination, self-sufficiency and self-control as the critical factor to explain the different degrees of success of the three Americas:

The transplanted peoples are the most successful and prosperous because they  had self-determination from the very beginning. Their status as colonies of Britain and France was semi-autonomous and they brought with them the economic practices of financial and industrial capitalism, free trade and rule of law that they already had in their countries of origin.

The testimony peoples struggled between their strong cultural roots in the ancient Aztec and Incaic agricultural empires and the feudal and mercantilist models Spaniards brought with them. Their centralized, monarchic political traditions blended quite smoothly, but the Catholic religious indoctrination and forced conversion clashed sometimes violently with the original culture. Testimony peoples struggled between two masters: the original (Incas, emperors, chieftains) and the "Crown & Cross" colonizers. Both cultures were autocratic, authoritarian and centralist, giving little room for independent thinking.

The new peoples, finally, had the hardest time for the forced nature of their migration, the ravages that slavery inflicted in family union, parenthood and ancestry. Not surprisingly, the regions affected by this model of colonization lagged behind in economic and human development. New peoples were never in control of their own lives, much less their government. Their countries look like a work in progress, hundred years after. Stephan Zweig dictum about Brazil summarizes it: "Brazil is the country of the future. And it will ever will"

Left Behind: The False Promise of Populism in Latin America

No other region in the world has elected and practiced populism more than Latin America. From Peron in Argentina to Castro in Cuba or Chavez in Venezuela, populist politics and policies have ruled the region for the past 80 years, with few exceptions: Chile, Costa Rica, Colombia (after Uribe).

Chilean economist Sebastian Edwards explains the four stages of populism: 

1. Euphoria and triumphalism: populist leaders campaign in popular "fixes" (such as subsidies to the poor, protectionism and price controls) and fanning voters anger towards internal and external "enemies" (such as "educated elites" or "IMF/Yankee imperialism") until economic crises make desperate voters (who under other circumstance would not fall for populist promises) put them in office. During the early "happy years" , freewheeling spending, printing money and issuing debt combined with currency controls and manipulation create an illusion of prosperity.
2. Problems: populist economics fuel rampant inflation (by subsidizing consumption) while punishing production with higher taxes on exports (the only source of hard, real currency) and printing either loose money or debt -or both- to get re-elected. During this stage populist governments give themselves special powers -such as ruling by executive fiat- and modify the Constitution to guarantee perpetual re-election. Migrants from poorer neighboring countries flood the country seeking a "free ride" on the benefits the populist regime distributes. The regime lets them in and gives them citizenship rights in exchange for votes.
3. Crisis: debt and inflation hit the poor and create food shortages, power outages and rising crime. Employment falls and the most skilled migrate. Pensions are sacked by the government to pay for debt and spend in re-election. Graft and corruption skyrocket and become systemic -as in the recent Odebrecht scandal  that spilled over almost all Latin American countries with populist governments.
4. Collapse and austerity: shut from international credit, unable to pay pensions and subsidies, hunger and riots erupt and the populist government falls. Enters IMF as a lender of last resort and demands a strict schedule of re-payments and strict control of public spending. Austerity is always unpopular, and countries with a history of populism fail to keep it long enough to recover. As soon as the economy starts to pick up, pressure for abandoning austerity become too strong and a new cycle begins.

In recent history, only Chile and Colombia were able to abandon populism and enjoy sustained growth and stability (both countries joined or applied to join OECD). Brazil made good progress under Fernando Henrique Cardoso and Lula's first term, but later abandoned the pro-business policies for others favoring clientelism and populism that ended in the Lava Jato (Car Wash) scandal, economic crisis and President Dilma Rousseff's impeachment.

Those interested in understanding how populism works will find extensive information looking at Latin America past 50 years and in Edwards's book Left Behind: The False Promises of Populism in Latin America.

Keeping score: it's the economy, stupid! (and also security)

GDPs 1970-2007 - Argentina - Brazil - Chile - Colombia

Those surprised by the seemingly abrupt turn from Left to Right in Brazil, Argentina, Nicaragua, Ecuador (and seemingly soon in Venezuela) would be less after looking at the graphic above. It shows how politics reflect wild swings between growth and recession and even depression. Voters react to economics rather than politics or culture wars.

In the years after the return to democratic rule (after 1985) Argentina (red) exhibits the wildest swings, whereas Chile, Colombia and even Brazil show the benefits of governance agreements (Concordancia in Chile , Alternancia in Colombia, PT-MDB in Brazil) and sustained economic and social policies.

Those surprised by Bolsonaro's or Macri's victories should look at the economic growth indicators but also those related to security and crime, two scourges in Latin American societies that misguided Letf-wing policies exacerbated. Voters not only vote against inflation and unemployment, but against decent people living behind bars in their homes when criminals roam free.

The lessons of the last 15 years of Left-wing policies are being taken to heart by voters and later, by politicians, who are now taming their rhetoric from Left-Right controversies to Backward-Forward, Growth-No Growth, Security-Insecurity options.

Those who worry about Latin America's democratic degradation should look at the causes in the past 15 years rather than ideological preferences. 

If there is a constant, however, is political swings and instability, characteristic of societies where the rule of law is still a work in progress.