Mercosur: The Need for Reforms

By Luis Ferreira Alvarez

The Mercusur Building, Montevideo, Uruguay.

The Mercusur Building, Montevideo, Uruguay. (Photo by Jimmy Baikovicius)

As Brazil and Argentina continue in recession, the Southern Common Market (Mercosur/Mercosul) provides them with a regional mechanism to restore economic growth. However, Mercosur has abandoned its free trade vision, instead becoming a protectionist organization. Reforming Mercosur would provide momentum for economic recovery. However, two fundamental changes must occur: Mercosur’s common policy of trade negotiations needs to be eliminated, and the organization’s Secretariat needs more independence. Changing these two components would allow Mercosur to return to its original mission of promoting free trade and create a stronger body, capable of finding consensus within the member states.

Mercosur — a free trade and custom union formed in 1991 between Argentina, Brazil, Paraguay, and Uruguay (and later joined by Venezuela) — promotes the free movement of goods and people across the zone. Mercosur’s members have benefited from having integrated markets that expand their commerce. Argentina’s 2013 exports to Mercosur represented 26 percent of the country’s total exports, compared to 2.2 percent in 1991, while Argentine exports to the rest of Latin America (through the Latin American Integration Association, or Aladi) came a close second, representing 15 percent in 2013 (Fig 1). These figures show that Argentina’s trade is highly integrated with that of its neighbors, and closer cooperation between Mercosur and the rest of Latin America (especially the Pacific Alliance), is critical for Buenos Aires’ commerce.

Brazilian exports to Mercosur represented 11 percent of total exports, from 10 percent in 1991. When added with the rest of Latin America, Brazilian exports to the region reach 21 percent. However, Brazilian exports are more diverse than Argentina’s, with the European Union and China representing the largest shares of its exports, 20 percent and 19 percent respectively (Fig 2). Thus, while Brazil exports a tremendous amount to its Latin American neighbors, its largest markets are outside the region.

Figure 1: Argentine Exports 2009 to 2013 (Percentage of Participation)

Figure 1: Argentine Exports 2009 to 2013 (Percentage of Participation)

Source: National Institute of Statistics and Census (INDEC)

 Figure 2: Brazilian Exports 2009 to 2013 (Percentage of Participation)

Figure 2: Brazilian Exports 2009 to 2013 (Percentage of Participation)

Source: Ministry of Development, Industry, and Trade (MDIC)

However, further integration would expand growth by creating integrated value-added chains, making Mercosur goods more valuable. Examples of these chains can be seen in goods manufactured within the North American Free Trade Agreement (Nafta) zone, where American workers produce 40 percent of U.S. imports from Mexico and 25 percent of imports from Canada. Creating such value-added chains in Mercosur would push Brazilian and Argentine manufacturers to become more efficient as well as create jobs on both sides. Furthermore, these valued-added chains could expand to other sectors, such as energy. However, accomplishing this task would mean reforming Mercosur by ending the common trade policy and de-politicizing the organization through a more independent Secretariat.

Ending the common trade policy would allow members to negotiate their own bilateral trade agreements while maintaining Mercosur. While having a single trade policy works for likeminded countries, Mercosur member states are ideologically divided between free traders and protectionists. This in turn delays trade negotiations when member states are unable to find consensus. The Mercosur-European Union trade agreement, which has been in negotiations since 1999, illustrates this divide. Finally, ending the common trade policy could help end the statist tendencies in some member states. Nafta provides another example of this: although domestic players pushed Mexico’s economic liberalization, the country’s integration with Canada and the U.S. made a return to protectionism very costly.

Finally, Mercosur’s Secretariat needs complete independence to ensure that all members benefit from the organization. Domestic politics has paralyzed Mercosur, creating obstacles for the organization’s effectiveness. To ensure that the aforementioned reform creates results, the organization’s Secretariat needs to make decisions without interference from members. Mercosur’s High Representative (the equivalent of the president of the European Council) needs independence to enforce organizational decisions. By creating a more independent Secretariat, Mercosur can promote intra-organizational standards and expand trade.

Reforming Mercosur should be one of the priorities of its members. By modifying its trade policy and giving more independence to its Secretariat, Mercosur could better serve the interests of all members. A reformed Mercosur could become an effective institution for internal and external investment. Lastly, reforms would provide members with more flexibility, allowing them to advance their own interests while maintaining Mercosur. Argentina and Brazil, the organization’s founding members and its largest economies, should lead the charge for reform or risk seeing it become just another South American political club.

Luis FerreiraLuis Ferreira Alvarez is a research analyst for an energy consulting firm and a UC Berkeley alum.

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The Brazilian Election and Central Bank Independence

By Carola Binder

The headquarters of the Banco Central do Brasil in Brasília.

The headquarters of the Banco Central do Brasil in Brasília. (Image courtesy of the Banco Central do Brasil.)

Brazilians will head to the polls on October 5 to vote in a tight presidential race. President Dilma Rousseff’s leading challenger is Socialist Party candidate Marina Silva. A key component of Silva’s economic platform is her support for a more independent central bank. Central bank independence, long a topic of interest to economists, is now capturing wide public attention — and for good reason.

Central banks across the world face different sets of laws regarding their governance structures, their autonomy, and the scope of their powers and responsibilities. In the last two decades, many countries have passed laws granting their central banks legal independence from government. Without central bank independence, inflation can be undesirably high for two main reasons. First, a government-controlled central bank might use monetary expansion to inflate away nominal liabilities such as government debt. Second, monetary expansion may be used to boost short-run growth for the sake of political popularity prior to elections. Central bank independence laws are intended to allow central bankers to focus on objectives like price stability without interference or pressure from the government.

Currently, Brazil’s central bank is not legally independent. The central bank president has no fixed term length and can be fired by the Brazilian president. President Rousseff and Silva debated the issue of central bank independence on September 1. Silva proposes increasing the central bank’s independence, for example by giving the central bank president a fixed term as a form of insulation from political pressure.

What could a more independent central bank mean for the Brazilian economy? Brazil’s central bank practices inflation targeting, a monetary policy framework that was adopted by many countries in the 1990s in an effort to bring down high inflation. An inflation targeting central bank announces a specific quantitative goal for inflation and uses monetary policy to keep inflation near the target. In Brazil, the inflation target is 4.5 percent, with a 2 percent window on either side. Thus the bank’s goal is to keep inflation between 2.5 and 6.5 percent.

Inflation in Brazil has hovered around 6.5 percent since 2008. A legally independent central bank would likely have pursued tighter monetary policy — namely, higher interest rates — to keep inflation nearer to the 4.5 percent target. Economic growth in Brazil has been fairly slow for the past decade, especially since 2011. Growth in the gross domestic product (GDP) was negative in the first and second quarters of 2014. Tighter monetary policy would further slow GDP growth, the last thing an incumbent wants near an election. Without legal independence, the bank has faced pressure not to raise interest rates as high as they otherwise might have.

Carola Binder.

Carola Binder.

Tighter monetary policy would, temporarily, be bad for the Brazilian economy. But a central bank with the independence to pursue the inflation target without interference could help in the long run. Monetary policy can help smooth fluctuations in the business cycle, but it is not the solution to low growth that arises for structural reasons. Allowing inflation to reach the upper limit of the bank’s tolerance interval for a short period to avoid a recession is perfectly suitable, but Brazilian economic growth has been weak, and inflation has been near the top of the tolerance interval for many years now. Such long-term stagnation needs to be addressed with deeper economic reforms, not with monetary policy. But reform is hard, and when policymakers hold sway over the central bank, they will naturally want to use it as a short-run solution to long-run problems.

President Rousseff argues that granting more independence to the central bank would pose a threat to financial stability. I don’t think that is the case. The biggest threats to Brazil’s financial stability arise from the same structural problems that result in its stagnant growth. As Professor João Saboia discussed at a CLAS seminar on September 10, economic reforms to improve labor productivity, such as improvements to the education system, are crucial for Brazil’s longer run macroeconomic prospects.

According to economists N. Nergiz Dincer and Barry Eichengreen, who have constructed indices of central bank independence for 89 countries, Chile has the most independent central bank in Latin America. Legislation granting independence to the Chilean Central Bank was passed in 1989. The Central Bank of Chile, like that of Brazil, is an inflation targeting central bank. Chile’s inflation target is 3 percent with a 1 percent tolerance window on either side. Chile has both a legally independent central bank and one of the most stable economies in the region and has maintained higher growth, lower inflation, and lower interest rates than Brazil in recent years. Clearly, central bank independence needn’t threaten financial stability or macroeconomic performance, provided an appropriate set of economic and political institutions are in place.

While President Rousseff and Ms. Silva differ in opinion on central bank independence, there is one aspect of Brazilian economic policy that both support — Bolsa Familia. Bolsa Familia is an anti-poverty program that provides cash transfers to a quarter of the Brazilian population. To receive these payments, families must keep their children in school and vaccinated. The program, launched by former President Luiz Inacio Lula da Silva in 2003, is widely acclaimed for its cost-effectiveness and for keeping more children in school instead of at work. Bolsa Familia seems very likely to remain in place, but other components of Brazilian economic policy will depend critically on the outcome of the election.

Carola Binder is a Ph.D. candidate in the Department of Economics at UC Berkeley.

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The Underside of Futbol

By Diego Ponce de Leon

Just a week ago I sat near Kenya’s Lake Naivasha watching the Brazil vs. Chile game. Chile was the underdog, and after having easily walked over Spain, they were the clear favorites inside the bar. In fact, every Kenyan I met that day was cheering for “red hot Chile.” I was amazed how well they knew the Chilean and Brazilian players (beyond Alexis Sánchez and Neymar) and found myself to be the only one cheering when Gonzalo Jara hit the bar and lost the game. The mood was incredible: halfway across the world, I was sitting at a table with Egyptian, German, American, and Kenyan friends watching a futbol game in peace. After leaving my home country of Mexico more than a decade ago, I am equally proud to be Latin American as to cheer for Giovanni Dos Santos’ goals. Although that night I was proud to see everyone cheer for Latin America — I haven’t seen anyone here cheer for Europe, it’s Latin America all the way — I was equally aware of how the World Cup has eclipsed glaring social inequities in our side of the world.

Photo1

Chilean fans celebrate their nation’s 2-0 defeat of Spain in the World Cup in Rio de Janeiro, Brazil, June 18, 2014. (Australfoto/Douglas Engle) © Douglas Engle 2014

Don’t get me wrong — I love futbol, and the World Cup is even more amazing. Watching the sport in itself is incredible, but watching an emerging economy take on a historical empire and take it out of the World Cup is inspiring. This year in particular, the underdogs have put up an incredible fight. Costa Rica, Colombia, and Mexico, who all played their hearts out, arguably deserved to win their knockout matches. Many across the continent and throughout the rest of the world share this fervor for underdogs.

This sentiment is not shared, however, when evaluating social inequities in the region. FIFA and the mainstream media have ignored protests against the World Cup in Brazil, while some governments (including Mexico) have used the event’s popularity to surreptitiously contrive and implement widely unpopular political reforms. Even my own friends who are attending the World Cup, members of Latin America’s well-educated middle class, take only glossy photos of their trip, avoiding situations and images that could potentially spoil their experience. Despite the goals and some comradery, this failure to note social tensions in the host country has left a sour taste. With Brazil’s devastating loss against Germany in the semifinals, there will be no comfort — nor justification — for the thousands of Brazilians who were displaced to make way for tourists in major cities.

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Churrasco, a beer, and a card game in the Mangueira favela during Brazil’s second World Cup 2014 match, June 17, 2014. Brazil tied with Mexico 0-0. (Australfoto/Douglas Engle) © Douglas Engle 2014

This World Cup has also highlighted yet again the pervasive discrimination that exists throughout Latin America. Mexican fans partook in deep ignorance cheering “P***” in unison at referees and team opponents throughout their games, arguing that the latter was not a homophobic remark but merely a colloquialism contextualized by situation. FIFA, in one of its most remarkable moments of utter absurdity, was tempted to sanction Mexico for discriminatory remarks — an unbelievable statement, given that the organization will host the next World Cups in Qatar and Russia, countries where it’s borderline illegal to be gay. Juan Camilo Zuñiga, the Colombian player who fractured Neymar’s vertebra has been receiving racist death threats, and a Brazilian candidate for congress went as far as suggesting that he should be assassinated.

In Brazil, a country where 60 percent of the population is either mixed or black, their absence is glaringly omitted from stadium stands (while some of the Brazil players dye their hair blonde and the black and mixed population sells beer and souvenirs to people on the street).About $US 4.2 billion have been spent on stadiums as well as on urban tourist infrastructure (airports, roads, renovated stadiums, athlete villages, and telecommunications), but little has been spent to improve basic services such as access to quality healthcare, education, and public transportation. Surveys around Brazil before and during the World Cup suggested that more than 60 percent of Brazilians think that the World Cup will not help the country.This imposition of mega-events without public consultation is the epitome of how politics is done in Latin America – and futbol is no exception. Traditionally the people’s game, the sport has long transformed itself through FIFA into a smoke screen and favorite tool for corruption, gentrification, and political obfuscation.

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World Cup 2014 opening match in Mangueira Favela in central Rio de Janeiro. (Australfoto/Douglas Engle) © Douglas Engle 2014

When Argentina wins the World Cup this Sunday, let’s remember those players who have used futbol to stand for something bigger than shoes, t-shirts, and cars. Let’s remember Socrates (Brazil, Corinthians), Caszely (Chile), Predrag Pasic (former Yugoslavia), Mekhloufi (Algeria), and Didier Drogba (Ivory Coast). In the words of Pablo Gentili, an Argentine academic and education reformer who has spent the last 20 years in Rio de Janeiro:

Understanding football is a way of understanding popular culture. There is an oppressive football that aims to colonize the hearts and minds of the poorest people, and sometimes it succeeds. But there is also a liberating football that, like emancipating dynamite, shudders the popular soul, filling it with affirmation and pride.

Lets hope Brazil can recover from this event, and that the 2014 World Cup wasn’t just an excuse for white elephants and the tearing away of social fabric. If Argentina doesn’t win, let’s just forget this World Cup ever happened. If Argentina does win, let’s hope that Messi and company have the class to party with Brazil and the rest of Latin America in this historical triumph.

Diego Ponce de Leon is a Ph.D. student in the Energy and Resources group who is working on smart urban energy infrastructure in Nicaragua. He is also a National Geographic Energy Challenge Grant Fellow, you can follow him on Instagram. Site: dleonb.com

Douglas Engle is a freelance still and video photographer based in Rio de Janeiro.

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Where Are the Protests? The Fitful Giant and Its Futebol

By Elizabeth McKenna

“The giant has awoken,” went the catchphrase. Last June, more than a million Brazilians took to the streets, initially to challenge a bus fare hike. The image of a once dormant, now dynamic colossus became one of the primary metaphors for the country’s 2013 protest cycle. One year later, as Brazil hosts the largest single-event sporting competition on earth, these masses are nowhere to be found. As one street vendor told me, “We Brazilians are anesthetized.” And futebol, it seems, is the opiate of choice.

A flyer that circulated on social media platforms before the planned June 20 anniversary protest. Superimposed on an image of the 300,000-person march on that date one year earlier, the text reads: prepare your breath, no letting up, 2014 will be bigger. The protest was billed as “The Return of the Giant” and given the Twitter hashtag #20J. Anniversary.

A flyer that circulated on social media before the planned June 20 anniversary protest. Superimposed on an image of the 300,000-person march on that date one year earlier, the text reads: prepare your breath, no letting up, 2014 will be bigger. The protest was billed as “The Return of the Giant” and given the Twitter hashtag #20J Anniversary.

A lone protestor flanked by dozens of military police on June 20, 2014. Two hours after the planned reprise of last year’s march, fewer than 30 demonstrators were present. Nine youth with backpacks, suspected members of the black bloc, were arrested for carrying “prohibited items”: gas masks, Guy Fawkes masks, and even camera batteries.

A lone protester flanked by dozens of military police on June 20, 2014. Two hours after the planned reprise of last year’s march, fewer than 30 demonstrators were present. Nine youth with backpacks, suspected members of the black bloc, were arrested for carrying “prohibited items”: gas masks, Guy Fawkes masks, and even camera batteries.

 

Does the World Cup alone explain why the streets are now devoid of demonstrators? A closer look at how last year’s protests were organized, the composition of the “new masses” who marched, and the few but steadfast activists who continue to occupy land and organize strikes provides a more complete picture of what became of Brazil’s 2013 unrest.

Mobilizing, not organizing

Liz McKenna at the June 2013 general assembly held in Rio to discuss the protest agenda.

Liz McKenna at the June 2013 general assembly held in Rio to discuss the protest agenda.

“No political parties!” the demonstrators cried last year in an effort to remain neutral. At a 100,000-person march I attended on June 17, 2013, protesters shouted down and then violently expelled members of a union with strong ties to the governing Workers Party (PT). Four days later, more than 2,000 people attended a general assembly to discuss the agenda for the next march. In the absence of a facilitator, the meeting began two hours late, and then only because a similarly partisan union, CSP Conlutas, lent their sound system to the gathering of mostly college-aged students.

In his book on the recent wave of global uprisings, Manuel Castells argues that the kind of horizontal, leaderless, and technology-driven mobilizing I witnessed last year can be a new source of power for aggrieved populations. This anti-authority approach, sometimes referred to as the practice of prefigurative politics, appeals nicely to the Left’s longstanding fear of structure, institutions, and leadership. Yet while communication networks have only increased in sophistication and reach in the past 12 months, the protests and assemblies have not. An older tradition in the social movement literature offers a similarly unsatisfactory explanation for the Brazilian case. Some theorists predict more unrest in propitious political circumstances, such as when the international public eye is trained on the country or when a presidential election is imminent. Yet despite the confluence of these factors in Brazil, the mass demonstrations dissipated almost as quickly as they began.

Who marched last year?

Although the vast majority of fans who can afford to watch the World Cup at the stadiums are white and wealthy, Brazilians from all social classes are transfixed by the games. As Pedro Peterson pointed out in his recent CLAS blog post, there is an important distinction between Brazilians’ passion for the jogo bonito and the atrocities committed in its name. When the national team plays, shops close, office workers are given paid leave, and all cars and public transport come to a halt. Yet in contrast to the apparent classlessness of the Cup, the composition of the June 2013 masses represented a narrower segment of Brazil’s urban populations.

Public opinion polling firm Datafolha found that the June 2013 protesters earned on average more than two times the minimum wage and were relatively well-educated and media-savvy. In São Paulo, over 77 percent of the demonstrators had attained some education beyond high school, and in Rio de Janeiro fully 86 percent had received either a high school or a university diploma. A staggering 84 percent of survey respondents did not claim affinity for any political party. None of these attributes conform to the profile of Brazil’s sub-proletariat masses. In subsequent surveys, public support for the protests declined from 89 percent in June 2013 to 66 percent in October 2013. Upper-class respondents were much more likely to continue to support the protests (80 percent) as compared those with the least schooling (47 percent) and those from lower income-brackets (42 percent).

These data seem to support the “differentiated” and “thin” adjectives that scholars have used to describe Brazilian democracy. Sociologist Luiz Werneck Vianna writes that neoliberal polices that re-entrench inequality are evidence of his country’s efforts to modernize while ignoring what it means to be modern. In his 2008 book Insurgent Citizenship, James Holston similarly notes that “Brazil’s differentiated citizenship is a case of centuries-persistent politics of legalized differences” (31). In other words, it was a shock that these relatively better-off and politically disengaged segments of society took to the streets last June and of little surprise at all that they have yet to return en masse.

The giants who never slept

When news media and newsfeeds touted the revival of the giant in 2013, many longstanding social movements responded with incredulity: “The giant may have just woken up, but the periphery never slept,” activists countered. As social scientist and favela resident Mônica Santo Francisco noted, “[People on the] margins never slept because the police never let them.” Guilherme Simões, a member of the Homeless Workers Movement’s (MTST)’s executive council, echoed this sentiment in a personal interview:

Brazil has a long history of peasants, workers, and marginalized classes engaging in struggle. The giant never slept, [that is], the Brazilian people who are most exploited have always resisted, but always within the context of a very strong state. The Brazilian state is perhaps one of the strongest and most consistent in post-colonial history; it has been able to administer class conflict very efficiently.

Worthy of investigation, then, are the numerous strikes, smaller-scale street protests, and land occupations that predated and outlasted June 2013. Although smaller in scope and scale, several actions have been extremely effective. For example, during Carnaval earlier this year, Rio de Janeiro’s garbage collectors went on strike, letting mountains of trash putrefy on crowded streets and otherwise picturesque beaches. They won a 37 percent salary increase. One of the MTST’s most recent occupations near São Paulo’s Itaquerão stadium — called the People’s Cup — earned them a meeting with President Rousseff and the promise of an additional 2,000 low-income housing units.

Perhaps a towering giant was never an apt metaphor for Brazil’s 2013 protest cycle. Demands were contradictory, ideologies at odds, and organizing structures virtually nonexistent. Instead, it appears that old-fashioned organizing practices are a more powerful locomotive of social change than are momentary uprisings convoked in cyberspace. Far from leaderless mobs, sustained grassroots campaigns depend, as ever, on the unglamorous but necessary work of movement building — regardless of how Brazil’s seleção fares in the end.

Elizabeth McKenna is a graduate student in the Department of Sociology at UC Berkeley.

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The Sins and Marvels of the World Cup

Pedro Peterson

Pedro Peterson (left) with a fan of Chile's La Roja.

Pedro Peterson (left) with a fan of Chile’s La Roja.

Eduardo Galeano, the world’s greatest football fan-poet, once said that “football is not guilty of the sins committed in its name.” In Brazil’s World Cup, which is built on sins both shameless and grotesque, and which has been a spectacle of football both lovely and exhilarating, Galeano’s line has offered fans of the sport an absolution of sorts.

Graffiti outside the Universidade Federal do Rio de Janeiro asks: "Who's the Cup for?"

Graffiti outside the Universidade Federal do Rio de Janeiro asks: “Who’s the Cup for?”

The sins committed in the name of the tournament became apparent to casual fans during last summer’s Confederations Cup in Brazil. Protests that drew millions of citizens to the streets of the country’s major cities received more attention than the football played on the pitch. The protests began with demonstrations against hikes in bus fares in São Paulo and Rio de Janeiro, and then spread as the violent police repression drew solidarity marches in other urban areas. It was not a great leap to contrast the inefficient, expensive, and unequal public services in Brazilian cities with the billions of dollars spent on stadium renovations and lagging “legacy projects” associated with the World Cup. The tournament quickly became the focal point of the protests.

In addition to the perception that stadiums were being prioritized over public services, the work related to the tournament itself was highly troublesome. As many as 250,000 residents were displaced by the stadium and infrastructure developments associated with the tournament; the projects were carried out hurriedly with minimal citizen participation; and there is increasing evidence of misspending and graft. On top of it all, federal and state governments have awarded FIFA $250 million dollars in tax exemptions on the estimated $4 billion profit it will reap. At the same time, FIFA has demanded that the Brazilian Congress overturn a law designed to ensure public safety during sporting events, which, among other things, banned the sale of alcohol (a clear affront to one of the tournament’s main sponsors, Budweiser). Although the protests during the actual World Cup have not reached the levels of last summer’s demonstrations (partly due to heavy, military-style suppression), a sense of ambivalence among Brazilians is impossible to ignore: from the stubborn defiance of the Twitter-friendly slogan #NãoVaiTerCopa; to powerful anti-Cup graffiti and street art; to the crass, misogynistic taunts thrown at President Dilma Roussef at the opening match between Brazil and Croatia in São Paulo’s new Itaquerão stadium.

Inside Maracanã Stadium.

Inside Maracanã Stadium.

What about the business happening on the pitch? This is the ninth World Cup of my lifetime, the first played in my native Brazil since 1950, and by far, the most compelling of them all. We’ve seen an absurdly high average number of goals per match (almost three, the highest since 1970). And the tournament has been blessed with so many captivating stories it is impossible to keep them all straight: underdogs unseating traditional powerhouses (Costa Rica against Uruguay, Italy, and England), marvelous goals (Van Persie’s header against Spain), genius individual performances (Neymar, Messi, Robben), unresolved oral fixations (Luis Suarez), and inspired team performances (Colombia, the United States).

Fans without tickets watch the match on a video screen.

Fans without tickets watch the match on a beachside video screen in Rio de Janeiro.

Aside from whatever happens to my Seleção, my lasting memory of the World Cup will be attending the Spain v. Chile game at Maracanã Stadium, where the southern La Roja eliminated its former colonial power and the reigning World Cup champions. Maracanã itself is an unrecognizable vestige of the gritty stadium I had visited dozens of times during my childhood after FIFA-standard renovations costing a cool $550 million turned the stadium into an attractive, safe, and highly exclusive national monument. Seating capacity is down — from just under 200,000 when it was inaugurated 64 years ago, to less than 80,000 today — with tickets officially selling for US$90 to US$1,000 (for those lucky enough to win the “privilege” of buying one in FIFA’s lottery).

But after each of Chile’s two goals, I jumped and hugged unknown Chileans in ecstatic South American solidarity, like I had done so many times in that stadium with my fellow flamenguistas. Now, a day before the group stage ends and the real excitement begins, I have been voiceless for about 10 days, my health has long ago abandoned me, my dissertation research is in shambles, and I go through daily cycles of indignation, national pride, national shame, exasperation, and speechlessness.

The business may be ugly, but the jogo bonito is as beautiful as ever.

Pedro Peterson is a Ph.D. candidate in the Department of City and Regional Planning at UC Berkeley.

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Bachelet’s First Month in Office — And What Lies Ahead

By Javier Couso

Isabel Allende swears in Michelet Bachelet as outgoing president Sebastián Piñera looks on.

Isabel Allende swears in Michelet Bachelet as outgoing president Sebastián Piñera looks on. Photo by Alex Ibañez.

On March 11, 2014, Chile experienced a highly symbolic political development when the newly elected head of the senate, Isabel Allende (daughter of the late Salvador Allende), swore in Michelle Bachelet as the new president of Chile. This powerful scene — in a country in which women are still underrepresented in the political, economic, and cultural arenas — was also politically significant, since it marked the first time in a century that a leader was elected twice to the country’s highest office.

In the weeks since taking office, Bachelet has surprised both political analysts and regular Chileans by strictly adhering to her ambitious program. Indeed, less than three weeks into her second administration, she sent congress a bill introducing a tax reform aimed at financing her education program. The bill, which aims to increase the taxes paid by big corporations from 20 to 25 percent of their annual revenues as well as strengthening the enforcement powers of Chile’s tax authority, is expected to increase government spending by 3 percentage points of the country’s gross domestic product, which is what the educational reform is expected to cost.

A Bachelet campaign billboard reads, "Free, High Quality Education." Photo courtesy of RiveraNotario.

A Bachelet campaign billboard reads, “Free, High Quality Education.” Photo courtesy of RiveraNotario.

President Bachelet’s decisiveness in her first few weeks in office has had a profound impact. First, her determination to fulfill her campaign promise to introduce significant changes in Chile’s current socio-economic model has increased her credibility among the large portion of the population who had become skeptical of politicians in recent years. Second, her focus on enacting the platform she campaigned on has provided a sense of mission and direction to her coalition, the Nueva Mayoría, which comprises a vast spectrum of political parties, from the Christian Democrats in the center to the Communists on the left. Lastly, the assertiveness of Bachelet’s first month in government has left Chile’s highly ideological right-wing parties confused to the point of paralysis, since they thought that her campaign promises were just a rhetorical move to prevail in the presidential election.

It is, of course, too early to know if Bachelet’s coalition will be able to deliver the congressional votes needed to pass the aforementioned tax reform bill and then move on to successfully tackle the even more demanding educational and constitutional reforms that complete the three pillars of her program. The key factor explaining this uncertainty is a political environment dominated by the total control that Chile’s corporate powers have over the country’s mainstream media. In the last few weeks the media has launched a relentless attack on the tax reform that might scare away some Christian Democratic legislators, thus compromising this crucial first step in Bachelet’s plans. Having said this, Bachelet’s highly effective management in the aftermath of the 8.2 Richter-scale earthquake that struck Northern Chile on April 2 has provided her with a great deal of credibility in the eyes of the bulk of the population, something which no doubt will help her weather the storm of criticism that Chile’s biased media has created.

In sum, it is clear that Michelle Bachelet’s second term in office will be very different from her first time at La Moneda, both in terms of the direction of her administration (this time, with deep transformations in sight) and in terms of the political environment she will face (a hostile media and a more diverse coalition). Bachelet is consciously taking a big political risk out of her intimate conviction that Chile desperately needs to change a political model that is still hostile to the wishes of democratic majorities, an economic model that is too dependent on the mere export of commodities, and a social model that is too dependent on markets for the provision of important social rights.

Javier Couso (right) speaks at UC Berkeley. Photo by Megan Kang.

Javier Couso (right) speaks at UC Berkeley. Photo by Megan Kang.

Javier Couso is a professor of Public Law and the director of the Constitutional Law Program at the Universidad Diego Portales in Chile.

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The Legacy Continues

By Julie Chavez Rodriguez

Julie Chavez Rodriguez introduces President Obama.

Julie Chavez Rodriguez introduces President Obama. (Photo courtesy of The Obama Diary.)

Since my days walking through Sproul Plaza as a proud Latin American Studies major, I always knew that I was walking down a path that was paved long before I was born. It was a path that people like my grandfather, Cesar Chavez, my grandmother Helen, and of course my parents Arturo and Linda made sure was open with endless opportunities. But never in my wildest dreams did I imagine that my journey would lead me to the White House.

Growing up in the Farm Worker Movement I was surrounded by some of the country’s best organizers. I spent my childhood in meetings, at rallies, walking picket lines, and handing out leaflets in front of super markets. I knew the names of the top five most harmful pesticides at the age of 12 and could recite some of my grandfather’s most widely known quotes. All of this is to say that I lived a tremendously privileged childhood, not in terms of material wealth, since my parents were full time volunteers for the United Farm Workers, but in terms of experience. The opportunity to travel with my grandfather, to learn from him, and to see him organizing is one of the most valuable classrooms I have ever been in.

"Cesar Chavez" producer Diego Luna and star Rosario Dawson at the White House Screening. (Photo courtesy of The Obama Diary.)

“Cesar Chavez” producer Diego Luna and star Rosario Dawson at the White House Screening. (Photo courtesy of The Obama Diary.)

Last week, when we had the opportunity to have the president host a White House screening of the new movie “Cesar Chavez,” I was overwhelmed with pride. It was as though my memories of childhood were intersecting with my new role in the Obama Administration. But there was one thing that remained constant and that was my role as an organizer. My grandfather used to tell us that the job of an organizer was to help ordinary people do extraordinary things, and that is how I have spent the last two and a half years serving our president.

As I introduced President Obama last week, I reflected on the sacrifice, service, and dedication we all make to improve this country and ensure we live up to our values. Below is a short excerpt from that introduction that for me epitomizes the important responsibility that I carry with me, knowing that I will forever be a Chavista!

When my grandfather decided to organize farm workers, he didn’t just start a union, he galvanized a movement.

All of the people I met who knew my grandfather had two things to say: first, my grandfather’s drive and sheer determination to continue organizing against all odds was infectious — those of us who grew up in the Farm Worker Movement call it our Si Se Puede attitude — and second, my grandfather taught them how to organize.

Whether it was marching, knocking on doors, or passing out leaflets for the United Farm Workers, that was the first time many of them had ever done any kind of organizing or public action. So I knew that the real legacy my grandfather left behind was in the hearts and minds of those he touched who would never sit idle in the face of injustice.

When I first heard President Obama speak, I could see my grandfather’s legacy in him. I could tell that he had that same Si Se Puede attitude and, like my grandfather, he trained a whole new generation of young organizers to know and believe that they could change the course of history. For those reasons I knew that I had to be a part of his administration, to carry on the work and the values of Cesar Chavez through the vision that our president has for this country.

So every day that I walk through the gates of the White House, I’m reminded that this is more than a job; it is a life’s work that began generations before me and will continue for many generations to come, thanks to my grandfather and to our President Barack Obama.

Julie Chavez Rodriguez.

Julie Chavez Rodriguez.

Julie Chavez Rodriguez is the Deputy Director of the Office of Public Engagement at the White House and a UC Berkeley alumna.

 

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